Bitcoin’s (BTC-USD) long-running four-year market cycle may no longer hold, according to Arthur Hayes, chief investment officer and co-founder of Maelstrom.
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In his new essay titled “Long Live the King!”, Hayes said that Bitcoin’s previous bear markets in 2014, 2018, and 2022 were driven not by the halving schedule but by global monetary tightening. Now that central banks are moving in the opposite direction, he believes that pattern has been broken.
“The four-year cycle is dead,” Hayes wrote. “The impending fiat liquidity deluge will keep the bull market going.”
Hayes Connects Market Cycles to Monetary Policy
Since Bitcoin’s launch in 2009, investors have watched the halving cycle as a roadmap for price movements. Each halving event has historically been followed by a sharp rally, then a steep correction 16 to 18 months later.
Hayes argues that this framework misses the bigger picture. The real driver, he says, is liquidity, not block rewards. “The primary catalyst behind previous bitcoin bear markets was monetary tightening in major economies,” he wrote, noting that during each of those downturns, Bitcoin’s price fell between 70% and 80% from its highs.
This time, he believes the opposite conditions are in play. “Traders wish to apply the historical pattern and forecast an end to this bull run,” he said. “But monetary expansion means that playbook no longer works.”
Global Liquidity Expands as Central Banks Ease
Hayes points to a worldwide shift toward easier monetary policy. The Federal Reserve cut interest rates by 25 basis points in September to around 4%, with markets expecting further cuts totaling 100 basis points in the year ahead.
“In the U.S., newly elected President Trump wants to run the economy hot,” Hayes wrote. “He talks about lowering the cost of housing to release trillions of dollars of trapped home equity.”
Meanwhile, Japan may soon return to stimulus under its new prime minister, who supports the ultra-loose Abenomics strategy. Even China, while cautious, has shifted toward policies aimed at fighting deflation rather than restricting liquidity.
According to Hayes, this synchronized easing will likely extend Bitcoin’s rally well beyond what traditional cycle theory predicts.
Hayes Sees Ongoing Upside for Bitcoin
Hayes said the combined effects of policy easing and expanding liquidity could keep Bitcoin climbing for longer than expected. “Listen to our monetary masters in Washington and Beijing,” he wrote. “They clearly state that money shall be cheaper and more plentiful. Therefore, Bitcoin continues to rise in anticipation of this highly probable future.”
The remarks add to growing speculation that this cycle may not follow historical patterns, as Bitcoin trades above $123,000, near record highs. Hayes believes that with fiat money flowing freely again, Bitcoin’s old boom-and-bust cycle could finally be over.
At the time of writing, Bitcoin is sitting at $123,058.28.
