In meetings with institutional investors over the past few weeks, the question I've been asked most often is: Is the four-year cycle for Bitcoin still relevant?
The so-called four-year cycle refers to the historical pattern of Bitcoin's price movement: "three years of growth followed by a sharp drop in the fourth year."
This is a crucial question because, according to the logic of a four-year cycle, next year will be a difficult year for Bitcoin and the entire cryptocurrency market.
While I cannot accurately predict cryptocurrency price movements next year, I believe it is unwise to blindly believe that the four-year cycle will mechanically repeat itself . After all, the four-year cycle is not a golden rule carved in stone by the gods of cryptocurrency; its formation actually stems from three specific driving factors:
- Bitcoin Halving Event: The mining reward on the Bitcoin blockchain is halved every four years.
- Interest rate volatility: The two interest rate spikes in 2018 and 2022 both contributed to the correction in the cryptocurrency market.
- The Cycle of Booming and Busting Markets: The years of cryptocurrency crashes (2014, 2018, 2022) invariably followed years of strong upward movement. For example, Bitcoin surged 5530% in 2013, 1349% in 2017, and 57% in 2021. During periods of market frenzy, fraud and speculative bubbles proliferate, and the bursting of these bubbles—such as the regulatory crackdown on ICOs in 2018 and the collapse of the FTX exchange in 2022—directly triggered market crashes in those years.
Today, these three driving factors have either significantly diminished in influence or are moving in the opposite direction to previous cycles . The impact of the Bitcoin halving is not as significant as it was four years ago; interest rates are more likely to decline than rise in 2026; and the cryptocurrency market in 2025 has not seen the kind of frenzied surge seen in previous cycles.
Meanwhile, even more decisive forces, particularly the large-scale entry of institutional investors and the gradual improvement of regulatory policies, are poised to emerge in 2026. In our latest " 2026 Market Forecast " report, we predict that Bitcoin will reach a new all-time high next year. Currently, I still believe this is the most likely outcome.
What will replace the four-year cycle?
If the four-year cycle has come to an end, then a reasonable question arises: what new framework should we establish for the cryptocurrency market in 2026 and beyond?
The four-year cycle has provided clear guidance for investors. Identifying whether we are currently in a market recovery, a bull market, or a cryptocurrency winter helps investors hold firm during bear markets and remain rational during bull markets.
So, what kind of thinking framework can replace it today?
The answer is: a ten-year protracted war.
I know this explanation doesn't sound as appealing as the four-year cycle. But let me explain, because I firmly believe this is the true nature of the market right now.
The so-called protracted war refers to a long-term struggle between two forces: one is a powerful, persistent and gradual positive driving force; the other is a negative impact force that erupts intermittently, comes on strong but lacks staying power.
The positive driving forces currently accumulating momentum include: the accelerated deployment of institutional investors, the continuous improvement of the regulatory framework, concerns about the devaluation of fiat currencies, and the implementation of real-world applications such as stablecoins and asset tokenization.
These trends aim to disrupt deeply entrenched traditional systems such as capital markets, global payment systems, and international monetary systems, and their full formation will inevitably take more than a decade. Early signs of this process are already evident: billions of dollars are flowing into cryptocurrency ETFs, cryptocurrency-related legislation is steadily progressing in Congress, and the stablecoin and tokenization market is rapidly expanding, among other things.
However, progress will inevitably encounter resistance. Potential negative impacts include: overall economic shocks, a wave of leveraged fund liquidations, and malicious events such as hacking attacks, fraud, and embezzlement. The impact of these negative shocks typically lasts for weeks, months, or quarters.
Overall, the long-term impact of positive drivers far outweighs that of negative shocks, but negative shocks can erupt extremely quickly and may suppress positive forces in the short term. The market crash of October 10, 2025, is a typical example: a general economic shock triggered a massive liquidation of leveraged cryptocurrency positions, directly leading to a precipitous market decline.
This protracted struggle has led to a severe divergence in the current cryptocurrency market: retail investors are in deep despair, while many institutional investors are filled with bullish confidence. The root cause lies in their drastically different time horizons. Retail investors are focused on the aftermath of the October liquidation events; while institutions envision a stablecoin asset size exceeding $3 trillion by 2030.
Both viewpoints have their merits, but they are based on different time scales.
The significance of a protracted war for investors
For the past few months, I've been analyzing the market using a "protracted war" framework, and this approach has proven extremely valuable. This protracted war pattern suggests the market will exhibit the following characteristics:
- In the long run, the returns are considerable but not outrageously high.
- Overall volatility has decreased
- Periodic pullbacks of 20%–40% occur
This means that investors must take every market pullback seriously, as they can last for a considerable period. However, as long as the fundamentals remain strong, there is confidence that prices will eventually rebound.
Looking back, I believe the cryptocurrency market officially entered a protracted phase when the Bitcoin spot ETF was approved in January 2024. This milestone event sparked a wave of institutional investment, a trend I believe will continue for a full decade. And indeed, since the ETF's launch, Bitcoin's price has risen by 93%, during which time it has also experienced three deep corrections exceeding 20%.
I believe the market will maintain this return pattern for a long time to come. While this protracted battle may not be as dramatic as previous boom-and-bust cycles, it signifies a deeper transformation for the cryptocurrency industry. When an asset class matures, the era of a protracted battle begins.
