The Bitcoin market has long been defined by its seemingly immutable four-year cycle, characterized by three years of rising prices followed by a sharp correction. However, recent shifts in U.S. policy, sparked by former President Donald Trump’s Executive Order, may fundamentally disrupt this cycle, leading to a potential era of extended growth for the cryptocurrency market.
Matt Hougan, Chief Investment Officer at Bitwise Asset Management, discusses whether Trump’s Executive Order can break crypto’s four-year cycle. His analysis suggests a strong possibility that it could, emphasizing the far-reaching implications of this government directive.
The Four-Year Cycle in Context
While many analysts attribute Bitcoin’s cyclical nature to its halving events, Hougan argues that these events do not align with the observed market patterns. Historically, the four-year cycle has been shaped by factors such as investor sentiment, technological advancements, and market dynamics. Often, a bull run is triggered by significant catalysts, including regulatory changes or infrastructure improvements that draw new investment.
Throughout its history, Bitcoin has faced numerous challenges, from the collapses of major exchanges like Mt. Gox to market corrections post-ICO boom. Yet, despite these setbacks, Bitcoin has always emerged stronger, surpassing previous highs and achieving new milestones.
Impacts of the Executive Order
Trump’s Executive Order focuses on creating a robust regulatory framework that prioritizes the digital asset ecosystem in the U.S. The order’s potential effects include:
- Regulatory Clarity: Establishing clear guidelines that pave the way for institutional investments in Bitcoin, encouraging large-scale capital inflow.
- Wall Street Integration: Facilitating entry for major banks into the cryptocurrency space to offer Bitcoin-related services, including custody and lending.
- Government Adoption: By potentially developing a national digital asset stockpile, the executive order hints at Bitcoin being recognized as a legitimate reserve asset.
The implications of these developments are profound. Unlike previous cycles driven primarily by retail speculation, the current shift is rooted in institutional intent—a more stable foundation for future growth.
A Possible End to Crypto Winters?
Based on historical trends, Bitcoin is expected to maintain its upward trajectory leading into 2026, albeit with certain risks attached. Hougan expresses optimism that institutional adoption will help mitigate the lengthy bear markets seen in past cycles. Today’s investor base has shifted significantly towards value-oriented institutions, which may sustain Bitcoin’s price during downturns.
What Lies Ahead for Bitcoin?
With Bitcoin surpassing the $100,000 landmark, ambitious projections see its price soaring to $700,000 in the next few years. If the policies introduced by Trump accelerate the trend towards institutional adoption of Bitcoin, the cryptocurrency could transition to a more conventional investment asset, akin to gold.
In conclusion, the four-year cycle has served as a roadmap for Bitcoin’s market behavior for over a decade. Yet Trump’s Executive Order could redefine this narrative, transitioning the market toward a more sustained growth phase driven by institutional support. The lingering question remains: Is a crypto winter in 2026 inevitable, or has Bitcoin’s maturation rendered such cycles a thing of the past?
Disclaimer: This article is intended for informational purposes only and does not constitute financial advice. Readers are encouraged to conduct thorough independent research before making investment decisions.
