Is the Bitcoin 4-Year Market Cycle Real? (2024)

Happy birthday, Bitcoin! On Jan. 3, 2023, the Bitcoin blockchain reached the age of fourteen. In some ways, 2009 seems like a lifetime ago and in other ways like it was yesterday. After 14 years, Bitcoin, the first successful cryptocurrency, is still the king, and, as king, the rest of the crypto market follows it.

Throughout Bitcoin’s short history, its price has experienced enormous swings to new all-time highs, followed by retracements that take back most of the gains. Studying the four Bitcoin market cycles, it becomes clear that other than the first cycle, the others are relatively consistent regarding timing.

This trend is especially true of the last two cycles, which are very close to 4 years each from peak to peak and bottom to bottom. Some have speculated that this timing results from the Bitcoin halving that occurs approximately every four years (210,000 blocks mined). The question now is: Is the Bitcoin 4-year cycle a real phenomenon or just a coincidence? And if it is real, will it continue?

Dissecting Bitcoin’s Market Cycles

For clarity, this article defines a market cycle from one bear market bottom to the next.

2010 to 2011 Market Cycle

The first accurate Bitcoin price tracking occurred in July 2010. By October, Bitcoin's price started to rise and peaked on June 8, 2011, at $31.90. The price began to fall over the next five months and bottomed at $2.01 on Nov. 19, 2011. This first cycle was the shortest of all the cycles to date.

2011 to 2015 Market Cycle

Cycle #2 began at the 2011 bear market bottom on November 19, after which the price bounced higher almost immediately. After the bounce, there was a six-month period of consolidation. After BTC broke out of the consolidation, it peaked at over $268 on April 10, 2013; a 76% drop followed that peak.

BTC recovered almost immediately and hit a bull market peak of $1,177 on Nov. 30, 2013. An 86% drop followed that peak; the bottom was hit on Jan. 14, 2015.

2015 to 2018 Market Cycle

The third cycle began at the 2015 bear market bottom on January 14. For the first 9 ½ months, the price of Bitcoin accumulated in a range of about $100. After the price of Bitcoin broke out of the accumulation range, it re-tested the range once before moving higher.

The move higher culminated in the bull market peak at just under $20,000 on Dec. 17, 2017. Once again, a price drop of 84% followed the peak and the bottom was hit almost one year later, on Dec. 15, 2018.

2018 to 2022 Market Cycle

The fourth cycle began on Dec. 15, 2018, and after about four months of accumulation, the price of Bitcoin broke out in a dramatic fashion. Over the next three months, the price of Bitcoin increased by over 200% and hit a high of $13,831 on June 26, 2019.

Over the remainder of the year, Bitcoin’s price slowly dropped but still finished up about 90% for the year. The start of 2020 saw a 45% increase in the price of Bitcoin, which peaked in mid-February. That was followed by the COVID crash, which bottomed in mid-March.

The recovery from the COVID crash was swift and eventually led to the next bull market. This bull market was reminiscent of the 2013 bull market. After pushing higher throughout much of 2020, the price of Bitcoin peaked on April 14, 2021. This peak was followed by a 55% pullback that bottomed on July 20.

Over the next month, the price of Bitcoin increased by over 134%, which led to the ultimate bull market peak on Nov. 10 at $69,000. Bitcoin’s price immediately began to drop and just over a year later, on Nov. 21, 2022, it hit what appears to be the bottom at $15,495.

Bitcoin’s (BTC) Entire Price History - Weekly Chart

By zooming out and looking at the entire price history of Bitcoin, you can calculate the timing of each market cycle. In the chart above, the green vertical lines mark the bull market peaks and the time intervals between them. The yellow dashed lines mark the bear market bottoms, with the time intervals between them.

Take note of the timing of the last two market cycles. They are close to a four-year cycle, from one peak to the next and from bottom to bottom. Another interesting observation is the time of year when the peaks and bottoms occur.

Other than the very first peak in 2011, all the others occurred in November, December or January. November has the most with two peaks and two bottoms, assuming that Nov. 21, 2022, marks the bottom for this bear market. Is this timing a coincidence, or is there a reason behind it?

Another observation is that each bear market low is higher than the previous low. Will that continue? Below is another chart showing the entire price history of Bitcoin.

Bitcoin’s (BTC) Entire Price History - Weekly Chart

The vertical lines on this chart mark each peak (green), when each halving occurred (red) and the date one year before each halving (yellow). The percentage increase in price is then measured between the vertical lines for each cycle. It is calculated for the year leading up to the halving and from the halving to the following peak.

It is clear that with each successive cycle, the percentage increase in price for the year leading up to the halving is declining. The same pattern is evident from the halving to the following peak. Again, with Bitcoin’s short history, it is unclear whether or not this pattern will continue. Visually, it is easy to see the diminishing returns with each successive cycle.

Timing for Bitcoin Bottoms - Halvings - Peaks

This chart shows how consistent the timing is from the bottom to the halving and from the halving to the following peak. The next halving is estimated to occur on March 28, 2024. Just for fun, extrapolating the data from the other cycles puts the next bull market peak in late October 2025.

Is there a meaning behind these patterns? Will these patterns continue? Can you even call these patterns with the limited amount of data? So many questions and because no one has a crystal ball, all people can do is watch as the next Bitcoin market cycle unfolds. It should also be noted that because many altcoins follow Bitcoin’s price action, there is also a crypto market cycle.

Will Bitcoin’s 4-Year Market Cycle Continue or Evolve?

Another important question is how the changing investor demographics will affect the Bitcoin market cycle. Over the last couple of years, the number of institutional investors has been increasing. The number of corporations holding Bitcoin has been growing as well. As more regulation is brought into the sector, institutional investment will grow.

The days of only retail investors and traders buying Bitcoin are over. Will this trend affect Bitcoin’s market cycle? As investor demographics change, the steep bear market pullbacks may become shallower. If this does occur, it will affect not only Bitcoin but also the entire crypto market cycle.

Retail buyers will come in late and panic sell when the market turns against them. As they become a minor part of the overall investor pool, their effect on Bitcoin’s price will diminish.

Institutional investors and corporations will be more likely to hold onto their Bitcoin. And depending on their average cost, they may even hold through bear markets. Together, these changes may significantly impact Bitcoin’s market cycle.

What is Bitcoin’s Current Market Condition?

The bottom of the 2018 bear market occurred two days shy of the one-year anniversary of the 2017 bull market peak. The low set on Nov. 21, 2022, at $15,476 (Binance), is one year and eleven days after the bull market peak on Nov. 10, 2021.

It may be too early to say that Nov. 21, 2022, is the bottom for this bear market. But, after 49 days of sideways price movement, Bitcoin’s price surged over 50% to just under $24,000. The likelihood of that being the bottom continues to increase.

Bitcoin (BTC) Daily Chart

In Bitcoin’s history, a macroeconomic environment like the past 12 months has not occurred. Inflation has soared to levels not seen in 40 years. To combat this, central banks worldwide increased interest rates to slow economic growth. The unknown now is whether this policy will result in recessions in some countries or worse worldwide.

A severe recession would drop markets worldwide and most likely put downward pressure on the price of Bitcoin. If a severe downturn can be avoided, 2023 should be a year of recovery for BTC. January has only a few days left and Bitcoin is up about 45% for the month, which marks an excellent start to the year.

Historically, the meat of bull markets has occurred after each halving. The next halving is estimated for the end of March 2024, so if this cycle follows past cycles, the next macro bull market should begin soon after.

Mark Twain is credited with saying, “History never repeats itself, but it does often rhyme.” This does appear to be true for Bitcoin’s market cycles. Whether or not rhyming continues is anyone's guess. What is becoming more evident is that with each day inches closer to the most exciting time in crypto. Will you be prepared for liftoff?

How to Buy Bitcoin

Now that you know how to use Bitcoin market cycles to get an idea of what the future holds for Bitcoin and the crypto market in general, here's how to buy Bitcoin. Because Bitcoin is the largest and most popular crypto in the world, it is offered by essentially all crypto exchanges. Some of the best exchanges that offer Bitcoin trading are eToro, WeBull, Gemini, Binance, Uphold and HYCM. Once you buy your Bitcoin, you should keep the coins off of the exchange to custody your crypto yourself for the best security. Ledger hardware wallets are all you need to keep your crypto safe and they support more than 1,800 cryptos including Bitcoin, Ethereum, Dogecoin, Ripple and all ERC-20 tokens.