Is Bitcoin’s 4-year cycle dead or are market makers in denial?

Bitcoin’s cycle of four years used to propose a simple script: half the reward meant scarcity, and scarcity meant higher prices.

This model has lasted for more than a decade. Every four years, the network’s reward to miners was halved, thus tightening supply, followed by a speculative frenzy that resulted in a new all-time high.

However, as Bitcoin barely passed $100,000 this week, down about 20% from its October peak of more than $126,000, that old narrative is wearing thin.

Wintermuteone of the largest market producers in digital assets, has now said the quiet part out loud. “The four-year cycle driven in half is no longer relevant,” he argued in a recent note. “What’s driving performance right now is liquidity.” The statement may sound heretical to longtime Bitcoin believers, but the data leaves little room for debate.

The market is now dominated by ETFs, stablecoins and institutional liquidity flows, with the issue of miners appearing to be a rounding error.

Liquidity rewrites the rules of the four-year cycle

The latest rally and Bitcoin withdrawal map in one metric: ETF inflows. In the week ending October 4, global crypto ETFs raised a record $5.95 billion, with US funds accounting for the majority of funds. Just two days later, daily net inflows reached $1.2 billion, the highest on record.

That flow of capital coincided almost perfectly with Bitcoin’s ascent to its new all-time high near $126,000. When inflows slow later in the month, so does the market. At the beginning of November, with mixed ETF prints and light flows, Bitcoin had returned towards the $100,000 line.

The parallel is striking, but not coincidental. For years, the halving was the cleanest model investors had for the mechanics of Bitcoin supply and demand: every 210,000 blocks, the number of new coins allocated to miners halved.

Since the April event, this figure stands at 3,125 BTC per block, or about 450 new coins per day, equivalent to about $45 million at current prices. This may sound like a large daily injection of supply, but it is dwarfed by the sheer scale of institutional capital that now flows through ETFs and other financial products.

When just a handful of ETFs can absorb $1.2 billion of Bitcoin in a day, that influx is twenty-five times the amount of new supply entering the market every day. Even routine weekly net flows often match or exceed the full week’s worth of newly minted coins.

The halving has not stopped importing entirely, as it still has an overwhelming influence on the mining economy. But, when it comes to market prices, the math has changed significantly. The limiting factor is not how many new coins are produced, but how much capital flows through regulated channels.

Stablecoins add another layer to this new liquidity economy. The total supply of dollar-pegged tokens now runs between $280 billion and $308 billion, depending on the data source, effectively functioning as the base money for crypto markets.

A rising stablecoin float has historically tracked asset prices higher, providing new collateral for leveraged positions and immediate liquidity for traders. If the halving restricts the faucet where new Bitcoins flow, stablecoins open the doors for demand.

A market governed by flows

Kaiko Research’s October report capture the transformation in real time. Mid-month, a sudden wave of deleveraging wiped more than $500 billion from the total crypto market capitalization, as the depth of the order book evaporated and open interest reset to lower levels. The episode had all the hallmarks of a liquidity shock rather than a supply squeeze.

The price of Bitcoin did not fall because miners removed coins or because a new halving cycle was due. It fell because buyers disappeared, derivatives positions collapsed, and thin order books amplified every sell order.

This is the world Wintermute describes: one governed by capital flows, not block prizes. The arrival of spot ETFs in the United States and the wider expansion of institutional access have rewired Bitcoin’s price discovery. Flows from major funds now dictate trading sessions.

The price demonstrations usually start in the hours of the United States, when the activity of the ETF is at its highest: a structural model that Kaiko has traced since the products were launched. Liquidity in Europe and Asia is still important, but now it acts as a bridge between the American sessions instead of a separate center of gravity.

This change also explains the change in market volatility. During previous halving periods, rallies tended to follow long build-up and grinding phases, with retail enthusiasm layered on top of dwindling supply.

Now, the price can lurch several thousand dollars in a day, depending on whether the ETF’s inflows or outflows dominate. Liquidity is institutional, but it is also fickle, turning what used to be a predictable four-year cycle into a market of short, sharp liquidity cycles.

This volatility is likely to persist. Future funding and open interest data from CoinGlass indicate that leverage remains a significant swing factor, amplifying moves in both directions. By the time financing rates remain high for extended periods, signaling that traders are paying heavily to stay long, leaving the market vulnerable to a sharp reversal if flows stop.

The October drawdown, which followed a surge in funding costs and a wave of ETF redemptions, offered a preview of how fragile the structure can be when liquidity dries up.

However, even as those flows cool, structural liquidity in the system continues to grow. Stablecoin issuance remains high. The FCA’s recent move to allow retail investors in the UK to access crypto-exchanged notes has sparked a fee war between issuers, leading to a spike in turnover on the London Stock Exchange.

Each of these channels represents another conduit through which capital can reach Bitcoin, thus tightening its correlation with global liquidity cycles and further distancing it from its autonomous halving cycles.

The Bitcoin market is now behaving like any other major asset class, where monetary conditions drive performance. The halving schedule once dictated the time of the psychology of investors. Today, it is the Federal Reserve, ETF creation desks and stablecoin issuers that set the pace.

In the coming months, Bitcoin’s trajectory will depend on liquidity variables. A base case sees Bitcoin oscillating between around $95,000 and $130,000 while ETF flows remain modestly positive and stablecoin supply continues its slow expansion.

A more bullish setup, with another record week of flows for ETFs or a regulatory green light for new listings, could push prices back towards $140,000 and above.

Conversely, an air pocket of liquidity marked by multi-day ETF flow and stablecoin supply contraction could bring Bitcoin back to the $90,000 area as leverage resets again.

None of these results depend on the issue of miners or the distance from the middle. Instead, they depend on the rate at which capital flows in or out of the pipes that have replaced the halving as Bitcoin’s key accelerator.

The implications reach beyond price. Kaiko’s data suggests that ETFs have also changed the microstructure of the spot market itself, tightening spreads and deepening liquidity during US trading hours, but leaving off-hours thinner than before.

That change means that the health of the Bitcoin market can now be measured as much by ETF creation and redemption activity as by on-chain supply metrics. When the daily production of miners is absorbed by ETF in a few minutes, it is clear where the balance of power lies.

Bitcoin’s evolution into a liquidity-sensitive asset may disappoint those who once saw the halving as a kind of cosmic event, a preordained countdown to wealth. Still, for an asset now held by institutions, benchmarked in ETFs, and traded against stablecoins that function as a private supply of money, it’s just a sign of maturity.

So maybe the halving cycle isn’t dead, just demoted.

The block reward still halves every four years, and some traders still use it as a guide. But the real map now lies elsewhere. If the last decade taught investors to watch the half clock, the next one will teach them to watch the flow tape.

The new Bitcoin calendar does not last four years. It is measured in billions of dollars that go in and out of ETFs, of minted or redeemed stablecoins, of capital seeking liquidity in a market that has outgrown its own mythology. Miners still have time, but time now belongs to money.