Galaxy Deep Dive: Is Bitcoin’s Four-Year Cycle Still Valid?
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Galaxy Deep Dive: Is Bitcoin’s Four-Year Cycle Still Valid?
This cycle’s peak is milder, implying that even if the correction continues, the bottom may still be higher than the extreme lows of previous cycles.
Navigating Web3 tides with focused insightsAuthor: Alex Thorn
Translated by Jiahuan, ChainCatcher
Over Bitcoin’s 17-year history, its price has consistently moved through long-term cycles. Approximately every four years, it surges to euphoric highs, endures painful drawdowns to bottoms, and then begins recovering anew.
Historically, this rhythm has been anchored to the four-year halving event, which cuts the regular new supply in half. Although the impact of successive halvings is diminishing—and despite widespread “super-cycle” speculation—empirical data reaffirms that the four-year cycle remains intact.
This report examines these fluctuations and identifies an emerging pattern in Bitcoin’s modern history: each cycle’s amplitude is more muted than the last.
The October 2025 peak was the calmest top in Bitcoin’s history; the subsequent decline was unusually gentle. Given such restraint at the top, should we expect the eventual cycle bottom to be exceptionally shallow? If so, where might that bottom land?
This report assumes the current drawdown’s bottom has not yet formed and provides data supporting that assumption. The data also suggests that the calmer October 2025 top may produce a higher cycle bottom.
Historical analogues indicate a base-case bottom for the current drawdown between $40,000 and $46,000, likely occurring between now and Q4 2026. (Base case is for illustrative purposes only; actual outcomes may differ materially.)
Crucially, this report relies entirely on market data, on-chain data, and time-cycle analysis. Our projected cycle-bottom range does not utilize or depend on assessments of the likelihood, timing, or impact of external events (e.g., regulatory, market, or geopolitical developments).
Is Bitcoin’s “Four-Year Cycle” Still Valid?
Each Bitcoin cycle follows a path from the prior low, through the halving, up to a top, and back down to the next low. Below are the four cycles—including the current one:
The bottom of the current cycle has not yet formed. As of the report date—June 9, 2026—the drawdown magnitude and elapsed time are both “so far” figures.
Note two patterns underpinning this report: first, the peak-to-trough decline in each cycle has shrunk (from 85% to 84%, then to 77%); second, historically, a bottom has appeared roughly 12–13 months after each top. The current cycle is only eight months past its most recent top.
When indexed, the October 2025 top appears exceptionally restrained relative to prior cycle tops. Consequently, the average price paid by holders—the realized price, or “cost basis”—is unusually close to the all-time high (ATH), reaching 43.7% of the prior ATH.
By comparison, this ratio has typically been one-third or lower in prior cycles.
This is a critical data point: if the same scale of selling occurs as ended previous bear markets, this cycle will stabilize at a significantly higher dollar level. Comparing cycle timing, amplitude, and on-chain metrics, the current drawdown may bottom within the following range:
The above price levels and analysis in this report point toward our view: the current cycle’s bottom has not yet been confirmed. Very few historical cycle-bottom indicators have triggered; in terms of time, the current decline remains shorter than historical drawdowns; and if true panic emerges, the cost basis itself will decline.
Our core thesis: empirically, the four-year cycle remains valid—but its amplitude has contracted. Calmer tops raise the floor but do not eliminate it.
How to Precisely Identify Cycle Tops and Bottoms Using Data
Pinpointing tops or bottoms while they’re forming is nearly impossible—or at least extremely difficult; yet in hindsight, everything becomes crystal clear. Our approach is therefore to list conditions that have historically occurred at tops and bottoms—and assess how many are currently active.
To build an evaluation framework for past tops and bottoms, we examined five categories of evidence: valuation (how high or low is the current price relative to holders’ purchase cost?), profit-taking (are holders selling strongly or capitulating weakly?), miners (are Bitcoin producers thriving or under pressure?), trend (how far has price deviated from its long-term mean?), and sentiment (greed or fear?).
Applying this five-dimensional lens to both ends of the current cycle yields a clear picture: Bitcoin’s volatility is contracting. Each top is less euphoric than the last, and subsequent crashes grow progressively shallower.
If this amplitude “contraction” is real—and holds at both cycle extremes—it offers valuable insight into the expected timing and location of the upcoming cycle low during the current drawdown. We can thus estimate a range where Bitcoin may bottom in this drawdown.
This analysis requires first defining metrics and establishing benchmarks to identify cycle tops and bottoms. We apply the same scoring methodology to both extremes: comparing each metric against the levels reached at every prior top and bottom.
Reviewing Cycle Tops
A top exists—but it is the calmest ever recorded. At the October high, only two of eleven classic warning signals reached even mildly elevated prior-top levels—and barely so.
The clearest valuation metric—the Market Value to Realized Value ratio (MVRV, measuring how high price stands relative to holders’ average purchase cost)—peaked at just 2.29, versus 2.93–5.91 at the prior three tops.
The entire “greed” indicator cluster registered the lowest cycle-top reading on record, and the Pi Cycle Top—a timing signal that previously predicted the past three tops with errors of just days—did not trigger at all, a first in Bitcoin history.
Yet timing was textbook-perfect: the top arrived on day 1,062 after the prior low—exactly matching the timing of the 2017 and 2021 peaks.
The twist lies in genuine euphoria arriving ~18 months earlier—around the U.S. launch of spot Bitcoin ETFs—after which enthusiasm waned yet price continued rising. In retrospect, this resembled institutional buying—not the retail-fueled frenzy that triggers explosive tops.
Below is the full top-indicator scorecard for the current cycle (anchored to the October 2025 all-time high).
Of the 11 magnitude signals: two were confirmed, two were partially confirmed (at least 85% of threshold), and seven did not trigger. The two confirmed signals (RSI and SOPR) barely crossed their weakest thresholds set in 2021—and both peaked in 2023 and 2024, not at the October 2025 price high.
Critically, although the cycle clock arrived on schedule, the Pi Cycle Top signal still did not trigger (since timing is a calendar fact—not a measure of top euphoria—these two metrics are treated separately).
“Prior top markers” represent the ranges observed at the 2013, 2017, and 2021 cycle tops; thresholds use the least euphoric of those three (the 2021 peak)—i.e., the easiest top threshold to cross. “Cycle peak” denotes each metric’s most extreme reading in the current cycle and the month it occurred. Reserve Risk and Pi Cycle Ratio use our internal measurement scales.
Projecting Cycle Bottoms
During this drawdown, only four of thirteen bottom signals have been triggered—three of them relatively weak: fear sentiment, trend indicators hitting bottom-range levels, and the first break below the 200-week moving average.
The fourth signal reversed in early June—the first miner-side warning: Hash Ribbons showed a recovery crossover. This occurs when the 30-day average hash rate climbs back above the 60-day average after a period of miner capitulation—and historically signals impending bottoms.
However, the strongest signals marking every true bottom—price falling below cost basis, holders collectively underwater, sustained loss-selling, deep panic washouts—have not yet appeared. The current −51% drawdown remains far milder than the −77% to −85% lows that ended prior cycles—and shallower than the −53% mid-2021 drawdown.
But the rhythm has shifted. Measured at the same point in the cycle (roughly eight months—or 242 days—after the peak), the recent decline has pushed the current drawdown slightly below the −48% level seen at the same stage in the 2013–2015 cycle (which featured relief rallies).
Thus, it is no longer the shallowest drawdown path on the chart (it had been for most of this drawdown). The 2017–2018 and 2021–2022 cycles were much deeper at this stage (both near −68%). By cycle-clock logic, the bear-market bottom window won’t open until late 2026.
Each curve tracks a cycle’s drawdown from its peak, aligned to Day 0. Around Day 242 (dashed line), the current cycle (orange, −51%) has dipped slightly below the 2013–2015 cycle level (−48%), ending its status as the shallowest drawdown path (which it held for most of this drawdown).
The other two prior cycles sit near −68% at this stage. All cycles remain well above today’s price (green band shows prior bear-market bottom zones).
Below is the full bottom-indicator scorecard for the current drawdown—using metrics that have previously signaled cycle bottoms.
Of the 13 target metrics, 4 have been triggered, 2 are approaching, and 7 remain untriggered.
To illustrate the significance of these bottom indicators, the table below lists when they triggered in prior cycle bottoms—and compares them to today.
Aligning these 13 identical signals across the past three cycles reveals a clear pattern: at every prior bear-market low, all 13 metrics eventually entered bottoming territory—the only difference being timing, with some triggering early and others late.
Today, only 4 have triggered—of which the sole miner-side signal (Hash Ribbons) was triggered only recently. (A notable distinction: this Hash Ribbons reversal appears to precede the bottom rather than lag it, as in prior cycles—a possible externality from Bitcoin miners pivoting toward AI, a phenomenon absent in past cycles.)
Numbers in prior-cycle cells indicate, within a 180-day window, how many days each metric’s most extreme value—closest to the bottom—led (−) or lagged (+) that cycle’s price low. Hash Ribbons refers to recovery crossovers; Cycle Clock refers to Month 12 post-top.
Each metric has triggered at all three prior bottoms—the signal’s meaning lies in whether it fires early or late. Since the current cycle low appears not yet arrived, the current column simply shows whether each checkbox has been ticked since the October 2025 price high.
Tops Get Lower, Bottoms Get Higher
Before drawing conclusions, state a foundational fact underlying the rest of this report: Bitcoin’s volatility has narrowed at both cycle extremes.
Top euphoria cools each cycle (MVRV: 5.91 → 4.72 → 2.93 → 2.29), while subsequent bottoms rise each cycle (MVRV: 0.56 in 2015 → 0.69 in 2018 → 0.75 in 2022).
In other words, the distance between each cycle’s most overvalued and most undervalued points continues shrinking. Crash prices tell the same story: drawdowns of −85%, −84%, −77%, and currently −51%.
Each top (red) and subsequent bottom (blue) price-to-cost-basis ratio (MVRV) converges toward “fair value” (1.0) from both sides. Data suggest the current cycle has likely not yet bottomed (hollow diamond = deepest reading so far). This describes the cycle pattern—not a guarantee of where this cycle will bottom.
Cooling tops and rising bottoms describe three completed cycles—not natural law. It does not prove the next low must be shallow.
But it lets us pose a precise question—and give a definite answer: If a bottom behaves identically to prior bottoms, how much does top euphoria determine the dollar drawdown magnitude?
A Higher Price Floor
MVRV is simply today’s price divided by on-chain cost basis. Rearranged, cost basis equals ATH divided by top MVRV. Thus, lower top MVRV means cost basis sits closer to the peak.
Because the October top is the calmest ever (MVRV = 2.29), cost basis ultimately lands at 43.7% of ATH (versus 34.2% at the 2021 top, 21.2% at 2017, and 16.9% at 2013). A calm top does not suppress the floor—in fact, holding all else constant, it brings cost basis closer to the peak, thereby raising the floor.
Cost basis as a percentage of each cycle’s ATH rises each cycle—reaching 44% in 2025—because each top grows milder. Annotations on each bar show the dollar drawdown corresponding to a typical traditional bottom shape in that cycle.
Now fix bottom behavior (assume each cycle bottoms at the same MVRV) and observe how dollar drawdowns shrink purely because cost basis starts higher. The table below illustrates this—without any forecasts:
Each cell shows: if the cycle bottoms at the MVRV in that column, the drawdown implied by that cycle’s unique cost-basis-to-ATH ratio.
Bottom behavior is identical across rows—the only variable is top calmness. A typical traditional bottom (MVRV = 0.70) meant −88% drawdown in 2013 but only −69% in this cycle. This isolates top impact alone—it’s arithmetic, not a claim that calm tops necessarily yield higher bottoms.
Where Is This Bottom?
Bottoms aren’t located by a single integer percentage—but relative to two key anchors: cost basis and the 200-week moving average (200w MA), which has served as Bitcoin’s long-term price support throughout its life.
Measured against these anchors, the past three bear-market lows fell significantly below both: averaging ~−33% below cost basis (2015’s deepest: −44%) and ~−14% below the four-year moving average.
Two points merit attention.
First, the gap below cost basis narrows each cycle (−44%, −31%, −25%), mirroring the contraction on the top side.
Second, today’s price hasn’t even approached that zone. Despite a 51% drop, Bitcoin remains 14% above cost basis (this cycle has never breached cost basis) and only 1.5% below the four-year moving average. By historical bottom-location metrics, this bottom hasn’t arrived.
Past bear-market lows’ distances below cost basis (blue) and four-year moving average (purple). Past lows sat far below both; today’s price remains above cost basis and only slightly below the 200-week MA—and the gap below cost basis narrows each cycle.
Anchors and arithmetic converge. Translating past gaps to today’s anchors points to the same zone: −25% to −44% below cost basis ≈ $30,000–$40,000; four-year MA gap spans ~$41,000–$62,000.
This implies the true bottom likely lies below today’s price—but far above the old “−75% to −85%” range.
Converting arithmetic to price—with today’s $53,000 cost basis—yields not a single number but a set of scenarios. Start with the central one.
Our base case assumes the bottom merely continues the per-cycle convergence toward fair value (MVRV 0.75–0.86), landing around $40,000–$46,000. A harsher, 2018- or 2022-style deep washout (MVRV 0.56–0.70) would place price at $30,000–$37,000.
A shallower outcome—where steady buying absorbs the drawdown near cost basis (MVRV 0.95–1.01)—would land price around $51,000–$54,000; merely touching the rising four-year MA ($62,000) implies only ~−51% drawdown. (For illustrative purposes only; actual outcomes may differ materially.)
Price-based scenario visualization. Cost basis and the rising four-year MA (historically proven to guide bottoms) sit far above the outdated “−75% to −85%” range (gray, deprecated).
Colored bands convert past bottom shapes into today’s dollar prices. These assume “bottom formed”—not that bottom is imminent. For illustrative purposes only; actual outcomes may differ materially.
The real insight is how this overturns old rules of thumb. A −77% to −85% drawdown (the accurate yardstick for past cycles) would place this bottom at $19,000–$29,000.
But this rule double-counts the calm-top effect: past −75% to −85% extremes were built on wildly euphoric peaks; this peak is mild and close to cost basis. Applying deep-drawdown ratios calibrated for extreme euphoria to this mild peak inevitably distorts the bottom forecast.
Across this entire chart, cost basis acts like an underlying tide—and most clearly shows the “floor” is mobile.
Over the past year, as high-price buyers in this cycle lifted the average, cost basis rose from ~$47,000 to a peak near $56,000 by end-2025 (a 20% increase). This climb is the deepest reason why the current bottom sits far above old rules.
But as some 2024–2025 coins turn over at losses during the drawdown, realized price subsequently fell ~5% to ~$53,000.
By end-2026, realized price (i.e., cost basis) will become the decisive variable for the bottom: calm, orderly declines let it stabilize—anchoring the base case near $45,000; true panic would further breach it, dragging the overall forecast lower.
Why Is the Bottom Mobile Too?
Cost basis is reflexive. It looks like a floor—but it’s built from the last traded price of every coin. During true selling, coins turning over at losses pull down this average—so this “floor” doesn’t hold price up; instead, it slides down with price.
This is the greatest constraint on the “higher floor” thesis. Buffer space is thin: today’s price sits only ~14% above cost basis (MVRV = 1.14), and this cycle has never breached it.
If a sell-off pulls cost basis down 10%, 20%, or 30%, a typical bottom shape could fall from ~$40,000 to ~$36,000, $32,000, or $28,000—re-entering normal historical ranges.
Holding bottom shape constant while letting cost basis decline in a sell-off. Implied bottom price slips from ~$40,000 back toward ~$28,000—re-entering normal historical ranges (amber). Calm tops raise the floor; true panic reclaims part of that gain.
Stable, price-insensitive buying from spot ETFs and corporate treasuries—absent in prior cycles—tends to lift the floor. But it buffers declines and amplifies them equally.
The nature of these funds dictates that Digital Asset Treasury (DAT) companies and corporate treasuries tend to buy high—not catch falling knives; and ETF flows turned net outflows in 2026. During true deep selling, fund redemptions may force sales—not absorb supply.
The 2022 cycle saw crypto’s largest forced-sell washout—and still only fell −77%. So “lower leverage this time” isn’t guaranteed. (These are supporting arguments—not core pillars of the thesis.)
A higher floor—and its erosion risk during panic—are two sides of the same mechanism: this cycle’s cost basis starts higher, but true market capitulation will lower it. This is precisely why we prioritize ranges over single values.
Data-Driven Outlook for the Drawdown
Our analysis clearly points to how deep—and how long—the drawdown will go.
A milder top lifted cost basis to 43.7% of ATH—so for any given bottom shape, dollar drawdowns are mechanically milder than in any prior cycle.
We argue the heuristic “Bitcoin always falls 75%–85%, so this cycle bottoms at $19,000–$29,000” is obsolete as a literal price floor.
Even a depth-of-past-washout scenario now maps to a far higher number. Thus, even our harsher washout scenario sits above that zone—and our base case lands in the $40,000 mid-range.
Comparing prior-cycle metrics and timing data, the bottom likely hasn’t emerged. Only 4 of 13 bottom indicators have triggered—and the drawdown is only ~8 months old, whereas history shows bottoms arrive 12–13 months post-top (and cost basis itself will decline).
True deep-washout signals include: price breaching cost basis, holders collectively underwater, sustained loss-selling, effective break below the four-year MA, and bear-market-grade deep drawdowns. If these reverse at prices far above old ranges, amplitude contraction at both cycle extremes is real.
Conversely, if full capitulation selling arrives on schedule, the calm top merely delays pain—not reduces it. Either way, cost-basis arithmetic shows the starting line for this judgment sits far above levels assumed by the old four-year-cycle rule.
This is a descriptive study—explaining how a calm cycle top shapes the arithmetic logic of the cycle bottom—not necessarily a forecast of price direction or targets. Our price levels are derived by analogizing current drawdown relative to today’s cost basis (which itself moves) using historical data.
Appendix A: Chart Library
We include numerous theme-organized supporting charts. The first group frames the cycle; the second walks through the full bottom checklist. In each metric chart, shaded bands show the range the metric hit at the 2015, 2018, and 2022 lows; orange markers show the latest reading.
Cycle Visualizations
Price vs. its cycle top. Full Bitcoin price history on log scale, marking prior three cycle tops (red) and the October 2025 high (orange).
Price vs. its cycle bottom. Same history, marking reference lows: bear-market bottoms in 2015, 2018, 2022 (red), plus pandemic crash and mid-2021 drawdown (gray).
Cycle Clock. Days from prior low (circle) or halving (square) to each top. October 2025 top landed precisely within the historical window.
Euphoria arrived early. Cycle valuation peak occurred in early 2024—around spot ETF launch; chain-level enthusiasm then faded while price rose ~70% more until topping in October 2025.
The signal that never triggered. Pi Cycle Top accurately predicted the 2013, 2017, and 2021 peaks within days (asterisks). In this cycle, its conditions were never met (first time at any cycle top).
Bottom Indicator Breakdown
MVRV. Ratio of price to holders’ average cost basis. Past bottoms crushed it far below 1.0; this cycle’s low so far halted at 1.14.
NUPL. Share of market cap in unrealized profit. Past bottoms drove it negative (collective loss); it remains positive today.
MVRV Z-Score. Standardized version of MVRV. Past bottoms registered deep negatives; this cycle remains positive.
Mayer Multiple. Price divided by 200-day MA. It has dipped into bottoming range—the most bottom-like trend signal.
Price vs. Four-Year MA. The 200-week MA is Bitcoin’s most durable support. Past bottoms touched or breached it; price has fallen below it for the first time this cycle.
SOPR. Average profit/loss of coins transferred that day. Past bottoms kept it below 1.0 for months (loss-selling); this cycle merely brushed below.
Net Realized Profit/Loss. Daily locked-in profit (+) or loss (−), scaled to market size. The surge in deeply negative loss-selling that marks bottoms hasn’t appeared.
Puell Multiple. Miner revenue stress indicator. Past miner-capitulation bottoms read 0.30–0.41; this cycle’s low (~0.44) came close but didn’t trigger.
Hash Ribbons. Hash-rate momentum. Below 1.0 means miners capitulating; it has persistently stayed below that threshold since 2026.
Fear & Greed Index. Our proprietary 0–100 sentiment metric—during this drawdown, fear ran deeper than the average of past bottoms. This is the only indicator definitively triggered.
Appendix B: Glossary
Bitcoin Cycle. Bitcoin’s ~four-year rhythm—multi-year ascent to new highs, sharp decline to lows, then long recovery. Each cycle typically centers around the halving.
Halving. Roughly every four years, the rate of new Bitcoin issuance is cut in half. A fixed protocol feature that has historically anchored each cycle.
All-Time High (ATH). Bitcoin’s highest daily closing price ever. This cycle’s ATH is $124,824 on October 6, 2025.
Drawdown. Price decline from peak, expressed as a percentage. A −50% drawdown means price fell halfway from ATH.
Cost Basis (a.k.a. Realized Price). Estimated average price paid by market participants for their Bitcoin holdings. Technically, it sums the price of each Bitcoin at its last on-chain transfer, divided by total Bitcoin count. It is the single most critical anchor in this report—and what we call the network’s cost basis.
Market Cap. Total dollar value of all Bitcoin at current price (price × circulating supply).
Realized Cap. Total value of all Bitcoin calculated at the price each coin last moved—not current price. Realized price equals Realized Cap divided by Bitcoin count.
MVRV Ratio. Market Cap divided by Realized Cap—or equivalently, daily price divided by network cost basis. Above 1.0 means coins are on average profitable; below 1.0 means on average unprofitable. It is the central thread running through this report.
MVRV Z-Score. Standardized version of the difference between Market Cap and Realized Cap—enabling comparison of extreme highs/lows across Bitcoin’s vastly different price eras.
NUPL (Net Unrealized Profit/Loss). Share of market cap in unrealized profit. High positives signal greed near tops; negative values (collective paper loss) often accompany despair-driven selling near bottoms.
SOPR (Spent Output Profit Ratio). Average profit/loss of coins transferred that day. Above 1.0 means coins are sold at profit; below 1.0 means holders are selling at loss—a bottom signal.
Mayer Multiple. Price divided by 200-day moving average. A simple metric measuring how far price deviates from its medium-term trend.
200-Day / 200-Week Moving Average. Average closing price over past 200 days (medium-term trend) or 200 weeks (~four years—the most durable long-term support line for Bitcoin).
Puell Multiple. Dollar value of newly mined Bitcoin relative to its one-year average—measuring miner revenue stress (low) or explosion (high). Named after ARK Invest analyst David Puell.
Reserve Risk. Measures long-term holders’ confidence relative to price. Presented as a ratio and used comparatively in this report.
Pi Cycle Top. A timing indicator that triggers when the 111-day MA crosses above twice the 350-day MA. It accurately predicted the 2013, 2017, and 2021 tops within days; it never triggered this cycle.
Hash Ribbons. Compares 30-day and 60-day average hash rates. When the short-term MA falls below the long-term MA, highest-cost miners shut down (capitulate); recovery crossovers have historically preceded bottoms.
Fear & Greed Index. A 0–100 sentiment metric built from on-chain, derivatives, and flow data. Low readings signal extreme fear (near bottoms); high readings signal extreme greed (near tops).
RSI (Relative Strength Index). A momentum oscillator ranging 0–100; high readings signal overbought conditions, typically near tops.
Cycle Clock. Days elapsed from cycle-start low—or from halving—to top or bottom. Bitcoin’s last three tops arrived ~1,060 days after the prior low; bottoms followed ~12–13 months after tops.
Reflexivity. A concept popularized by George Soros in his 1987 book *The Alchemy of Finance*, describing how a metric used as a benchmark can itself be altered by price movements. Here, cost basis appears like a floor—but during true selling, loss-based coin turnover lowers it. The floor is a moving target—not a fixed red line.
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