Bitcoin’s Market Rhythm Is Shifting as Politics and Liquidity Take Control

Bitcoin investors have long believed in a familiar rhythm that shaped expectations and strategies across market cycles. For more than a decade, traders linked Bitcoin’s explosive rallies to halving events that reduced new supply and tightened issuance. These events created a narrative of predictable scarcity and delayed price appreciation. Each cycle reinforced the belief that halving mechanics sat at the core of Bitcoin’s long term market behavior. That belief shaped both retail enthusiasm and institutional positioning.

New research has shown that the assumptions about the 4-year cycles in Bitcoin are inaccurate, but the cycles themselves are still valid. The research, conducted by Markus Thielen, who is the Head of Research for 10x Research, indicates that while the Bitcoin cycles are still in place, the four-year cycle does not rely solely on halving events for their start. The timing of peak prices are becoming more closely aligned to political events and periods of increased liquidity.

The data compiled from historical periods suggests that Bitcoin prices are at their highest during US election cycles and do not correlate to the specific time frame after a halving event. This change in the relationship between Bitcoin and the traditional global financial system signals a significant change in how investors perceive (and interact with) Bitcoin and the traditional global financial systems.

The Bitcoin Four Year Cycle Still Exists but It Has Matured

The Bitcoin four year cycle continues to guide market structure, but its internal drivers have matured alongside the asset itself. Earlier cycles relied heavily on supply shocks created by halvings, which reduced block rewards and constrained miner selling pressure. Those reductions mattered when Bitcoin traded in smaller, less liquid markets. Today, Bitcoin supply inflation has already fallen significantly, reducing the relative impact of each halving event.

As Bitcoin markets deepened, demand forces gained dominance. Institutional capital now enters and exits based on macro conditions rather than blockchain schedules. Large investors react to rate expectations, fiscal policy, and political stability. These factors influence capital flows more aggressively than gradual issuance reductions. The Bitcoin four year cycle now reflects capital cycles rather than mining cycles.

Global Liquidity Now Controls Bitcoin Momentum

Global liquidity has emerged as the most powerful force shaping BTC price behavior. Central bank policies, interest rate decisions, and fiscal spending directly affect capital availability. When liquidity expands, investors increase exposure to growth assets. Bitcoin responds quickly due to its fixed supply narrative and high beta profile.

Liquidity contractions, however, suppress Bitcoin performance regardless of halving schedules. Higher rates and tighter financial conditions reduce leverage and speculative demand. Bitcoin struggles during these phases despite long term scarcity narratives. This reality highlights the growing influence of macroeconomic forces.

Institutional Capital Changed Bitcoin’s Market Behavior

Institutional adoption has transformed BTC from a niche asset into a macro relevant investment. Funds, asset managers, and corporations allocate based on economic signals rather than protocol mechanics. They monitor inflation, yields, and policy outlooks. Their participation increases BTC sensitivity to global liquidity shifts.

The introduction of spot Bitcoin ETFs accelerated this transformation. These products simplified access and funneled traditional capital into crypto markets. ETF flows respond instantly to policy headlines and political developments. This behavior reinforces liquidity driven price movements.

What Investors Should Watch in the Next Cycle

Investors can no longer rely solely on halving timelines to anticipate market peaks. Monitoring liquidity conditions provides clearer signals for trend strength. The US election cycle now plays a critical role in shaping market sentiment. Global liquidity indicators offer early warnings for momentum changes.

Bitcoin’s evolution strengthens its role within the financial system. The cycle survives but adapts to new realities. Investors who blend macro awareness with long term conviction gain strategic advantage. Markets reward flexibility, not rigid narratives.