Bitcoin has been defined for years by a seemingly inflexible four-year cycle. This pattern is three years with soaring prices, followed by a dramatic correction. A seismic change in Washington policy, spearheaded by the former president Donald Trump, could shatter this four-year cycle, ushering in a period of sustained growth in the cryptocurrency market.
Matt Hougan is the Chief Investment officer at Bitwise Asset Management. He recently raised an interesting question. Can Trump’s Executive Order break crypto’s four-year cycle? Although nuanced in nature, his answer leans toward an emphatic You can say yes to that.
This is a recap of the Four-Year Cycle
Hougan clarifies a personal belief, that Bitcoin’s halves are not the driving force behind the Bitcoin cycle. He claims, “People try to link it to bitcoin’s quadrennial ‘halving,’ but those halvings are misaligned with the cycle, having occurred in 2016, 2020, and 2024.”
Bitcoin’s 4-year cycle is historically driven by investor sentiments, technological advancements and market dynamics. Typically, a bull run emerges following a significant catalyst—be it infrastructure improvements or institutional adoption—which attracts new capital and fuels speculation. Over time, leverage accumulates, excesses emerge, and a major event—such as regulatory crackdowns or financial fraud—triggers a brutal correction.
From the early years of Mt. Gox implosion of 2014, to the ICO boom-and-bust in 2017-2018 and, most recently, 2022’s deleveraging crisis with the collapses of FTX Capital and Three Arrows Capital. Every winter, however, has been followed with a stronger resurgence. The latest one was sparked by mainstream adoption of Bitcoin-based ETFs, which occurred in 2024.
Related: Nasdaq Proposes In-Kind Redemptions for BlackRock’s Bitcoin ETF
What a game changer!
Hougan asks whether Trump’s latest statements are a threat to democracy. Executive OrderThe order, which emphasizes development of digital assets in the U.S. will upset the existing cycle. The order, which includes a detailed regulatory framework, and envisions even a national stockpile of digital assets, represents the strongest stance any U.S. president has ever taken on Bitcoin.
It has profound implications.
- Clarity in Regulation: The EO removes all legal uncertainties, allowing institutional capital into Bitcoin to reach unprecedented levels.
- Wall Street Integration Major banks are now able to enter this space with Bitcoin lending and custody. They can also offer structured products and Bitcoin custodial services.
- Government Adoption This concept suggests that the U.S. Treasury may hold Bitcoin in reserve, thereby solidifying Bitcoin’s status as “digital gold”.
The cumulative impact of these developments could change the market dynamics for Bitcoin. Unlike previous cycles that were driven by speculative retail euphoria, this shift is underpinned by institutional adoption and regulatory endorsement—a far more stable foundation.
Related: Why Hundreds of Companies Will Buy Bitcoin in 2025
Crypto Winters: The End of a Season?
Bitcoin’s rise would likely continue through 2025. However, it will then experience a substantial pullback by 2026. Hougan believes that the current situation may be different. He acknowledges that there is a risk of leveraged bubbles and speculative exuberance, but argues the scale of institutional investment will stop the type of bear market seen previously.
It is important to make this distinction. Bitcoin did not have a large base of investors who were value-oriented in previous cycles. With ETFs, it is now easier to allocate Bitcoin to pensions, sovereign wealth funds and hedge funds. What is the result? There may be corrections, but these will probably be shorter and shallower.
What comes next?
Bitcoin’s value has already surpassed $100,000. According to industry experts, such as BlackRock CEO Larry Fink and other leaders in the financial sector, it is expected to reach $700,000. If Trump’s policies accelerate institutional adoption, the typical four-year pattern could be replaced by a more traditional asset-class growth trajectory—akin to how gold responded to the end of the gold standard in the 1970s.
Related: BlackRock CEO Larry Fink Forecasts $700K Bitcoin Price Amid Inflation Worries
While risks remain—including unforeseen regulatory reversals and excessive leverage—the direction of travel is clear: Bitcoin is becoming a mainstream financial asset. Bitcoin may have been a four-year cycle driven by its infancy, speculative character and early stages. But as it matures, such cycles could become obsolete.
You can also read our conclusion.
Investors have been using the four-year cycles as a guide for Bitcoin market movement. But Trump’s Executive Order could be the defining moment that disrupts this pattern, replacing it with a more sustained and institutionally-driven growth phase. The question of whether Bitcoin is a good investment for Wall Street, businesses, or even governments has become less relevant. If you want to know more about if crypto winter will come in 2026—but rather If it comes at all.
Disclaimer: This article contains only general information and is not intended to be a financial advisory. It is important that readers do their own research prior to making an investment decision.
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Source: bitcoinmagazine.com
