BTC Artist
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According to a recent report from CryptoQuant, Crypto market liquidity is hitting levels never seen before, going past all past records. A big reason for this rising liquidity? The quickly growing supply of stablecoins in use. When more stablecoins get made and used, it tends to show serious demand from investors looking to get not just Bitcoin, but other digital currencies too. From this view, the overall vibe in crypto markets is looking super bullish right now.
Recently, the bulls made a huge push to finally break through the $70,000 price level for Bitcoin and set fresh all-time highs. Given their non-stop momentum overshadowing the bears’ resistance, it likely won’t be long now before they hit a huge milestone.
The “4-Year Cycle” Phenomenon In Crypto
Amid this price surge, well-known crypto analyst Quinten Francois has spelled out in a thread the striking “4-year cycle” pattern that has happened in this market. Based on Francois’ breakdown, crypto markets tend to cycle through distinct roughly 4-year periods driven by Bitcoin’s halving events, crypto being a fairly new asset class, and the overall market psychology and herd mentality among traders. Each 4-year cycle has clear phases: an accumulation year, a pre-bull run stretch, an intense bull market frenzy, and lastly a bearish downturn.
The accumulation phase sees decreasing interest and stable prices after the prior bear market’s low point. This sets the stage for the pre-bull run period when prices move back toward prior highs as enthusiasm grows again. The pre-bull run gets the market ready for the following intense bull market – an era of sky-high price jumps amid widespread FOMO and speculative craziness. However, the unbridled frenzy always ends in a severe crash and bearish funk in the cycle’s final year.
While Francois notes these boom-and-bust cycles have gotten a bit smaller over time (signaling crypto gradually maturing as an asset), the core psychology and herd effects making them happen show little sign of stopping anytime soon. His advice is to slowly build positions during the accumulation years, but take profits and cut exposure during the tops of overheated bull market periods to avoid emotionally bad decisions.
Even though the 4-year cycle idea has become well-known in crypto circles, Francois argues that hasn’t stopped its continued effects from happening. Most traders still clearly struggle to control greed and fear, keeping the cycle going. For those investors aware of this pattern and sticking to a disciplined, fundamentals-based strategy, huge opportunities to make gains likely await over the coming cycles.
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