Bitcoin cycles are repeating patterns in price behavior that are closely tied to specific events, such as the halving, which occurs roughly every four years.
The halving event that took place in April 2024 marked the beginning of the current Bitcoin cycle, and 2025 is shaping up to be a key year to observe how the market evolves, especially with growing institutional participation and the maturation of the crypto ecosystem in general.
BUY BITCOIN (BTC) ON BIT2METhe four phases of the Bitcoin cycle
Bitcoin cycles can be explained by four key phases: accumulation, growth, distribution and downward trend. Each has characteristics that affect both price and investor sentiment.
Accumulation
At this stage, the price remains relatively stable after a period of decline. Investors, primarily institutional and more experienced investors, take advantage of the opportunity to buy at low or moderate prices without generating a significant increase in volatility. Market psychology is cautious and skeptical, as many believe the recovery will take some time.
However, during this phase, the foundation for the next bull cycle is being laid.
Growth
As more participants join, a sustained price increase begins. Media attention and market enthusiasm increase, attracting profit-seeking traders and retailers. This phase is marked by intense growth and a clear upward trend. Demand outstrips supply, largely due to the decrease in Bitcoin production implied by the arrival of a halving.
Psychology turns optimistic, and many begin to experience FOMO, the fear of missing out.
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At this stage, the market shows signs of saturation. The price typically reaches or exceeds previous highs, but the trend begins to show volatility and uncertainty. Investors with substantial profits begin to sell, and newer entrants may hold positions for fear of missing out.
This phase can present strong fluctuations and temporary corrections, reflecting the struggle between buyers and sellers.
Downtrend
Finally, the correction phase or downward trend involves a significant drop in the cryptocurrency's price, caused by massive profit-taking and the potential exit of many market participants. This period is typically negative in terms of sentiment, leading to despair or pessimism among investors and the market in general.
This is the point at which the cycle can bottom out, starting the accumulation phase again.
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These four phases, which make up each Bitcoin cycle, reflect not only quantitative changes in price, but also qualitative changes in investor perception and behavior, from initial caution to overwhelming enthusiasm and finally distrust or fear. Therefore, understanding this journey is essential to interpreting current and future market dynamics and making informed investment decisions, although each cycle can have unique characteristics depending on the current economic and regulatory conditions.
Why are Bitcoin cycles important?
In the case of Bitcoin, these cycles are especially important since the cryptocurrency is designed with a limited supply and its output is automatically reduced by half every time a power event occurs. halving, approximately every four years. This significantly affects supply and, consequently, market prices.
To understand the significance of all this, it's crucial to know that 2025 is shaping up to be a pivotal year, as it's the first full year since the halving occurred in April 2024. According to experts, this event has traditionally driven the price upward in the following months or years.
INVITE AND WINFurthermore, Bitcoin cycles not only impact its price but also influence market psychology, marking the transition between periods of risk aversion and enthusiasm for increasing positions. The market's maturation and the growing institutional participation seen in 2025 could be marking new market dynamics. Therefore, understanding these cycles helps you anticipate potential movements and make more informed investment decisions.
The crypto community's expectations for 2025
2025 is shaping up to be a pivotal year for Bitcoin, being the first full year after the fourth halving from the network. Historically, the 12 to 18 months following these events have seen sharp price increases, accompanied by increased adoption, especially among institutions.
Bitcoin is currently trading at around $93.000, and while this represents a 15% correction from its all-time high of $109.287 at the beginning of the year, the market continues to show signs of strength and consolidation.
Bitcoin spot ETFs, which began trading in 2024 in the United States with figures such as BlackRock, have contributed to the legitimization of the cryptocurrency and have attracted previously unseen capital. Likewise, political and regulatory support, including the executive order for the creation of a Bitcoin Strategic Reserve by the US government, reinforce the institutional momentum. Also, the greater integration of digital assets with the traditional financial system and, on the other hand, the digitization of real-world assets on the blockchain. Due to all this, the expectation that the price of Bitcoin could reach between $150.000 and $XNUMX, is growing. $ 250.000 dollars by the end of 2025 remains in force among experts.
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