'Long Live the King': Bitcoin Billionaire Arthur Hayes Predicts the BTC 4-Year Cycle Is Over
News Summary
Crypto entrepreneur Arthur Hayes asserts that Bitcoin's traditional four-year cycle, which typically involves a post-halving peak followed by a 70-80% crash the subsequent year, is now over. He predicts that Bitcoin will continue to rise due to increased global money supply and Federal Reserve interest rate cuts. Hayes specifically highlights that, under pressure from President Donald Trump, the Fed resumed cutting interest rates in September 2025, despite inflation remaining above its target. He also references China's reluctance to hinder global fiat credit growth as beneficial for digital assets, emphasizing that past cycle predictions failed to understand underlying mechanics. However, other experts hold divergent views. Some analysts, including blockchain data firm CoinGlass, suggest Bitcoin is still behaving in line with previous cycles, indicating the price top might be in. Conversely, other experts propose that the approval of spot Bitcoin ETFs last year may have disrupted the traditional cycle, leading to new highs both before and after the last halving. Gabe Selby, head of research at CF Benchmarks, believes the current cycle is still undervalued by 20-50% relative to liquidity and anticipates a sustained reflationary impulse as monetary easing broadens in 2026. Kaiko Senior Research Analyst Adam McCarthy cautions that it's difficult to establish a pattern for an asset only 16 years old.
Background
Bitcoin's 'four-year cycle' is a widely discussed theory linking its price movements to its 'halving' event, which occurs approximately every four years. Halving reduces the supply of new Bitcoin, historically pushing prices to a cyclical high the year after, followed by a significant correction the subsequent year. In traditional financial markets, accommodative monetary policy and low interest rates typically stimulate investor interest in 'risk-on' assets, including stocks and cryptocurrencies. Currently, U.S. monetary policy is under close scrutiny from President Trump, who favors looser policies to stimulate economic growth. Arthur Hayes himself received a pardon from President Trump in 2025 after facing charges related to BitMEX's failure to operate an anti-money laundering program, highlighting his indirect connection to high-level U.S. politics.
In-Depth AI Insights
Why is Arthur Hayes so convinced that Bitcoin's four-year cycle is over, and what are the deeper considerations behind this stance? Hayes's conviction likely stems from more than just increased money supply. Deeper drivers may include: - Accelerated Institutionalization: The approval of spot Bitcoin ETFs signifies a fundamental shift in Bitcoin's market structure, attracting a broader array of institutional investors and traditional capital flows. This could smooth out the retail-driven cyclical volatility of the past, introducing more sustained buying pressure. - Political Intervention in Monetary Policy: President Trump's direct and successful pressure on the Fed to cut rates suggests monetary policy in 2025 and beyond might be more politically driven than purely economic. This 'hot economy' policy orientation creates a long-term bullish environment for risk assets, diverging from traditional Fed independence. - Geopolitics and Dollar Status: The mention of China's reluctance to hinder 'global fiat credit growth' hints at a geopolitical consideration where major economies might use monetary easing to maintain global liquidity, addressing potential economic challenges or competition, thereby indirectly bolstering Bitcoin's appeal as a hedge or alternative store of value. What are the broader implications of sustained presidential intervention in Fed policy for risk-on assets, including cryptocurrencies? Presidential pressure and successful influence on Fed rate decisions could have the following strategic implications: - Reduced Policy Predictability: Impaired Fed independence could render monetary policy paths more unpredictable, as they might become more susceptible to political cycles and electoral pressures rather than long-term economic stability goals. - Elevated Inflation Expectations: The Fed's rate cuts despite above-target inflation could fuel higher long-term inflation expectations. In such an environment, assets like Bitcoin, often dubbed 'digital gold,' would see their attractiveness as an inflation hedge significantly enhanced. - Structural Boost to Risk Appetite: If the government explicitly favors 'running the economy hot,' markets may internalize this expectation, leading to a structural increase in long-term risk appetite for risk-on assets, thereby sustaining higher valuations for longer periods. What are the risks and opportunities of over-relying on historical cycle patterns for a relatively young and evolving asset class like cryptocurrency? Overly rigid reliance on historical patterns in the current rapidly changing macro and micro environment can be dual-edged: - Risk: Structural Market Changes: The emergence of new products like spot ETFs, coupled with evolving regulatory landscapes and institutional participation, is reshaping Bitcoin's market dynamics. Past cycles may not fully capture the impact of these new factors, leading to inaccurate predictions based on historical patterns. - Opportunity: Value Reassessment in a New Paradigm: If historical cycles are indeed broken, Bitcoin could be entering a new growth phase driven by macro liquidity, institutional adoption, and geopolitical factors. This presents an opportunity for investors who can identify and adapt to the new paradigm to re-evaluate its long-term value and growth potential. - Challenge: Volatility Persists: Even with a changing cycle, as a risk asset, Bitcoin will still face high short-term volatility from macroeconomic shocks, regulatory changes, and shifts in investor sentiment. Investors need to differentiate between cyclical and structural changes and manage associated risks.