Crypto market cycle

Market cycle theory, borrowed from traditional finance, describes four phases. In accumulation, prices are low and interest is muted while patient buyers build positions. In markup, prices rise, media attention returns and new investors arrive. In distribution, early holders sell to late buyers near the top, and in markdown prices fall until capitulation resets the cycle.

Crypto has shown these phases unusually clearly. Bitcoin's history includes several multi-year boom and bust cycles, which many analysts link to the four-year halving schedule, while others point to global liquidity, interest rates and leverage. Each bear market has erased most altcoins' gains and pushed bitcoin down by well over half from its peak.

Cycles are patterns, not schedules. Their length and depth have varied, new forces such as spot ETFs and institutional buyers may change them, and identifying the current phase is always clearer in hindsight. Using a past cycle as a precise timetable for the next is a common mistake.