Opinion: Bitcoin’s four-year bull-bear cycle may be over

By Dan Polotsky, CoinDesk

Compiled by: Felix, PANews

With the upcoming Bitcoin halving, we seem to be on the cusp of a major event. While everyone is keeping an eye on the soaring Bitcoin and the possibility of setting new highs, the impact of this halving is far-reaching and will touch every aspect of the crypto market, and may even mark the end of the four-year bull-bear cycle in the crypto market.

This is not just about numbers, but about a potentially huge shift in how traditional industries perceive and interact with digital currencies. Get ready, this could be the beginning of a whole new era for cryptocurrencies.

The rise of Bitcoin

Recently, the price of Bitcoin has surged, driven by events such as the upcoming Bitcoin halving event in April, the approval of a Bitcoin spot ETF in the United States, and the entry of financial institutions such as BlackRock into the crypto industry. This institutional interest brought unprecedented demand, with Bitcoin hitting an all-time high of over $73,000 on March 13. The new high was likely driven by ETF inflows, including $1.045 billion on March 12.

The launch of ETF marks the wider recognition of cryptocurrencies as legal assets and a new stage for institutional investment. In addition, it further enhances Bitcoin’s credibility and accessibility to retail investors.

These landmark developments allow investors to gain exposure to Bitcoin without the complications of direct ownership. Increased liquidity and stability will likely continue to attract a wider range of investors, driving wider mainstream adoption and further fueling the current Bitcoin price surge.

Of course, the bear market still exists. However, various parties’ predicted prices for Bitcoin range from US$150,000 to US$250,000 per coin, causing a large amount of institutional capital to flow into the Bitcoin market. This event marks a potential shift in its historical cycle dynamics, driving new levels of growth and innovation across multiple digital asset sectors.

Nothing is certain, potential negative factors still exist

Despite the clear bullish momentum in the crypto market, several factors could undermine the trend. Continued inflation could prompt tighter monetary policy, which in turn would affect riskier assets such as cryptocurrencies. Sluggish economic growth could also undermine investor confidence and divert attention away from speculative investments.

Another short-term bearish factor lies in the mining sector. The upcoming 2024 halving event is expected to trigger large-scale consolidation and defaults as cash-strapped miners face reduced margins and high operating expenses. This may force miners to sell Bitcoin in bankruptcy, which in turn depresses Bitcoin prices. In addition, regulation and reduced inflows also pose challenges that may put downward pressure on prices.

Uncertainty surrounding the 2024 election adds another layer of unpredictability. The election results could lead to different regulatory changes, and the U.S. government’s stance on cryptocurrencies could change. While a Republican president may provide a more favorable regulatory environment, alignment with values such as financial inclusion and environmental sustainability could promote bipartisan support for crypto regulation.

**Is the crypto bull-bear cycle over? **

Perhaps the most unexpected is the other effects of the halving. While historically, the halving has been a driver of bull markets, the impact of the halving may be overshadowed by the other factors mentioned above, such as ETF net inflows, which currently total over $12 billion. The intervention of institutional and retail ETF investors under the guidance of experienced investment advisors who are good at “buying on dips” may weaken the effect of the halving in driving the market forward.

This will mean the end of the typical four-year bull-bear cycle in the crypto market, and a relatively stable upward trend may appear in the future. ETF fund inflows will become a major catalyst for cryptocurrency adoption. It is worth noting that this is the first time that the price of Bitcoin has soared before the halving, which was not the case in the past.

This shift could have far-reaching consequences for the entire industry. Initially, the crypto ethos was rooted in a resistance to centralized currencies and institutions, with the slogan “no keys, no coins.” It now appears that the dominant forces in crypto may soon be controlled by a handful of institutions, running counter to the original ideal of decentralization.

The tilt of ownership toward institutions could lead to something even bigger: sovereign nations owning Bitcoin. More countries may follow El Salvador’s lead and begin a race to accumulate cryptocurrencies, kicking off a supercycle of global mainstream adoption.

This change could also cause the crypto market to move away from its traditional boom and bust cycles, creating a more stable environment for the industry to grow and develop.

Although fewer retail investors can enjoy the dividends of the bull market, retail investors will also be exempted from the cruel reality of buying at high points and suffering losses when the market plummets.

This new stability can provide crypto companies and projects with the opportunity to focus on sustainable, long-term development, rather than relying solely on riding market cycles and struggling in the crypto winter.

As investors and enthusiasts prepare for higher volatility, it’s clear that the market is on the verge of an unprecedented outburst and could undergo a fundamental shift. While the future will be mixed, the coming period could signal a major shift away from cryptocurrencies’ infancy. Before saying goodbye, one should be ready to celebrate its “last dance.”

Related reading: Bitcoin returns to $71,000, analysts: the next target is $83,000