00:01 Are four-year price cycles in Bitcoin
00:04 officially over? Well, we don’t know.
00:06 But let’s talk about what they are and
00:08 the probabilities each way. Okay, so
00:11 what is the 4-year price cycle or for
00:14 short the four-year cycle? Well,
00:16 Bitcoin’s price has always eventually
00:18 gone up over time, but in the past, for
00:21 the last 16 years, it’s gone up not in a
00:24 straight continuous line, but in price
00:27 cycles. What is a price cycle? A price
00:29 cycle is where the price of Bitcoin
00:31 starts to go up and then it starts going
00:33 up more and then it starts going up more
00:35 and then you get what’s called a blowoff
00:37 top. A blowoff top is when the price
00:39 goes up very quickly in a relatively
00:41 short period of time and blowoff tops
00:44 are then followed by a correction. A
00:46 correction is when the price because it
00:48 got so ahead of itself in the blowoff
00:50 top comes back and down to something
00:52 more reasonable and then the price cycle
00:54 starts again. Now, historically, the
00:56 four-year cycles have been correlated
00:59 with the having cycles. So, Bitcoin’s
01:02 new supply issuance of new Bitcoin that
01:05 is issued every 10 minutes to the
01:07 Bitcoin miners has uh has a cycle that
01:10 every four years it cuts in half and it
01:13 just so happens to align with the years
01:15 of the presidential elections in the
01:17 United States. So, that was 2012, 2016,
01:20 2020, and 2024. And historically what
01:23 has happened is that having cycle has
01:26 started the next bull run meaning up
01:30 optimistic run. And that bull run has
01:34 eventually peaked out the year after the
01:37 having in a big parabolic upward swing
01:41 that is then followed by a significant
01:44 price correction. Now over time the
01:46 magnitude of those huge upswings has
01:49 been lower because the asset Bitcoin as
01:51 an asset is more mature and the price
01:54 corrections have been shallower meaning
01:56 less painful following those huge price
01:59 runs. But that has been the history of
02:01 it. The most recent price cycle would
02:04 have been the 2022 well let me put it
02:07 this way would have started after the
02:09 2017 bull run which then 2018 came way
02:12 back down. Then it rebuilt in 2019 and
02:14 2020. And then 2021 was a huge up year
02:18 followed by a price correction in 2022.
02:20 And then the price rebuilt in 2023, 2024
02:24 and so far in 2025. But this time has
02:28 been very different and the reason is we
02:30 have not had a huge parabolic upswing.
02:34 So the price has marched up nicely. It’s
02:36 gone up in you know a handful of days.
02:38 Big swings to the upside. But then
02:40 rather than going through a correction,
02:42 the price is then stabilized and ground
02:45 sideways. Sometimes called
02:47 consolidation, sometimes called chop
02:49 solidation because the price is either
02:51 chopping sideways or it’s consolidating,
02:54 meaning it’s trading in a relatively
02:55 tight price range. And it’s done that
02:58 for between 3 months and 9 months and
02:60 then it goes up again. So the price
03:02 stayed below $20,000 for a series of
03:04 months. Then it traded in the 20,000s
03:07 for a ser, you know, for a series of
03:08 months. Then it bounced around in the
03:09 30,000s, 40,000s, then up to the 70 sort
03:13 of 50 to 70,000s. It stayed there for a
03:16 good while and then it went up to the 90
03:18 to 100,000s. Now we are in the sort of
03:21 110 to 120,000. And the question is, how
03:24 long are we going to be in this 110 to
03:27 $120,000 range? And are we going to get
03:30 a huge parabolic price rise? Let me tell
03:33 you what that looks like if we got one.
03:35 If it what it looks like is the price
03:37 starts to run and then over a relatively
03:39 short period of time the price goes from
03:41 let’s call it $120,000 up to between
03:44 180,000 and perhaps 220,000.
03:48 And if that price increase happens very
03:50 quickly over a relatively short period
03:52 of time, then it tends to be
03:54 unsustainable at that level. That does
03:55 not mean we will not end up at 180 or
03:58 220,000 eventually. It just means it
04:01 tends to be unsustainable if it happens
04:03 very very quickly because there’s just
04:05 not enough new adoption of people
04:08 adopting Bitcoin to sustain it at the
04:10 price level. So while there’s, you know,
04:12 there’s demand, speculative demand to
04:15 drive the price that high, there’s not
04:17 enough real adoption to hold the price
04:19 that high. Again, there always is
04:20 eventually, just not when it all happens
04:23 very quickly at one time. So if that
04:25 happens towards the end of this year,
04:27 early next year, something like that, we
04:29 suddenly get a price run from, let’s
04:31 call it 120 to somewhere between 180,000
04:33 and 220,000, then it is likely if that
04:36 happens very quickly, that that would be
04:38 followed by a price correction and the
04:40 price would drop back down to I don’t
04:42 know 120,000. You know, if it goes from
04:45 220 to 120, that’s, you know, not 50%
04:49 but it’s, you know, I don’t know, 45% or
04:50 whatever it is. So that is what a price
04:53 cycle would look like if we get one. But
04:56 again, this cycle has not looked that
04:59 way. This cycle has been instead marked
05:01 by an upswing in the price by maybe 10
05:04 or 20%, grind sideways for 3 to 6
05:07 months, go up another 10, 20, 30%, grind
05:10 sideways for 3, 6, 9 months, go up
05:13 another 10, 20, 30%, grind sideways.
05:16 Now, so about 60% of the people think
05:19 we’re done with price cycles because the
05:21 Bitcoin exchange traded funds, ETFs,
05:23 were approved in January of 2024. So
05:26 that’s been more than 18 months ago.
05:28 Wall Street is now adopting Bitcoin in a
05:31 significant way. Lots of more people are
05:33 hedging their bets. This is, you know,
05:34 bets. There’s not there’s not the same
05:36 level of just very uh speculative
05:40 retail, meaning retail means
05:41 nonprofessional. There’s not as many
05:43 just crazy people sitting in front of
05:44 their laptops buying and selling Bitcoin
05:46 who have no idea what they’re doing. And
05:48 that tends to make anything that looks
05:50 like a price cycle worse because those
05:52 people tend to buy on the way up and
05:53 sell on the way down which makes cycles
05:56 uh more pronounced versus professional
05:58 traders who are smart enough to
05:60 generally not be buying more when
06:02 something is going crazy up and then of
06:04 course when it comes back down they’re
06:06 they’re buying it because it’s on sale
06:07 which tends to smooth out those cycles.
06:09 So about 60% of people think that price
06:11 cycles are behind us and we’re not going
06:13 to get that sort of uh high magnitude
06:17 change. But that leaves about 40% who
06:19 are saying, “Nope, price cycles are
06:20 still with us.” And what’s going to
06:22 happen is the price is going to start to
06:24 rise. And then everybody’s going to say,
06:26 “Well, it just does this.” And then
06:27 we’re going to grind sideways. But
06:28 enough people are going to notice that
06:29 we just keep grinding sideways and then
06:31 up, gr sideways up, sideways up,
06:33 sideways up. That people are going to
06:34 say, “Well, this asset’s pretty
06:35 amazing.” Uh who doesn’t want to know
06:37 own an asset that grinds sideways but
06:39 then always eventually goes up and then
06:41 people will start speculating. People
06:42 will start using leverage which means
06:44 borrowed money to buy more Bitcoin. And
06:47 that demand of people who think that
06:49 price cycles are over is exactly what
06:52 creates a price cycle. Because as soon
06:54 as people think any asset can’t go down
06:56 anymore or just doesn’t ever go down
06:58 anymore, they start buying more of it
07:00 than they can afford to hold. they start
07:02 buying that asset with borrowed money
07:04 and at some point they have to pay back
07:06 that borrowed money and then they end up
07:07 upside down and blow up, you know, blow
07:09 up their portfolio and all that, which
07:11 is not something any of you should do
07:12 because you should never buy Bitcoin
07:14 with borrowed money. But anyway, if that
07:16 starts to happen, then we will see a
07:19 price cycle because that’s exactly what
07:20 triggers a price cycle. So, I tend to
07:23 agree with the 60%. Although the the
07:26 caveat when I guess maybe I’m more
07:28 50/50. Um the caveat here is anything
07:31 that grids sideways and goes up
07:33 consistently produces huge returns year
07:36 after year after year. And it’s only a
07:38 matter of time till people notice that
07:39 and then again they start speculating on
07:42 the upside buying it with borrowed money
07:44 which creates exactly the huge upside
07:46 run that causes that cycle to repeat.
07:49 So, you know, it’s sort of a
07:50 self-fulfilling prophecy if people are
07:52 like, “Well, cycles are over and now it
07:54 just goes up eventually all the time.”
07:56 Well, that’s exactly the sort of thing
07:57 that would make people speculate on that
07:59 and buy it with borrowed money because
08:01 it always eventually just goes up. And
08:02 then, of course, that is exactly what
08:04 produces the uh the parabolic rise
08:07 followed by then a price crash because
08:09 it wasn’t sustainable. So, I don’t know.
08:11 I’m more 50/50 of our price cycles over.
08:13 Now, what can you do? because we don’t
08:15 know whether it’s 6040 they’re over
08:18 whether it’s you know 50/50
08:21 the same strategy applies in all
08:23 situations which is if you buy as much
08:24 Bitcoin as you can right now then it
08:27 doesn’t matter because if the price does
08:29 take off from 120,000 up to 180 or 220
08:33 so what you just ride it out is it going
08:35 to stay up there probably not it
08:37 probably will go through a correction
08:38 but you don’t know how high it’s going
08:40 to go you don’t know how deep of a
08:41 correction it will go through so but if
08:44 but if you buy Bitcoin before that
08:45 happens, you don’t have to care. So, for
08:48 somebody like me, I don’t actually care.
08:49 If we go through a huge parabolic rise,
08:51 sure, I’ll take it. I might buy buy
08:54 myself some nice things when the price
08:56 seems crazy. Uh, which means go on a
08:58 nice vacation. I don’t know, buy myself
09:00 an electric jet ski or I don’t know,
09:02 something. I don’t think I will. But,
09:04 you know, if there’s something nice I
09:05 want and Bitcoin’s up at 220,000 a coin
09:08 and it seems unsustainable up there,
09:10 hey, you know, if there’s something nice
09:12 you want or some expense you want to pay
09:15 off or something like that, not a bad
09:16 time to do it if the price seems like
09:18 it’s going crazy. Um, now the reverse is
09:21 also true that um, you know, if when the
09:23 price is down, you can not worry about
09:25 it. You can just hold. there’s no reason
09:27 you have to worry about what the price
09:28 is going to be uh you know short or long
09:31 term if you’re just holding because if
09:33 we don’t go through a parabolic rise and
09:35 we all just chill out and Bitcoin keeps
09:38 grinding higher grinding higher grinding
09:39 higher and boring us all to death on the
09:42 way to a million dollars per coin well
09:44 great you also you’re in a good spot
09:46 because you’re buying Bitcoin and
09:47 holding so the way people get upside
09:49 down on these things is they don’t buy
09:52 the Bitcoin right now they wait and they
09:55 let the parabolic rise in price
09:58 be the validation that it’s a good
10:00 asset. So as the price rises 140, 160,
10:04 180, they use the price as their
10:06 validation that Bitcoin is amazing,
10:08 which means they’re buying it only after
10:10 the price rise. And that is a problem
10:13 because at 180,000, you know, if it
10:15 happens in the course of a month from
10:17 120 to 180, I can’t tell you how
10:19 sustainable that is. I can’t tell you
10:21 how high it’s going to go. And no matter
10:23 how high it goes, I can’t tell you if
10:25 it’s going to have a price correction
10:26 after it goes that high or not. The
10:28 short take is nobody knows. And because
10:30 nobody knows, you don’t want to be in
10:33 the position where you’re trying to
10:34 decide if you should buy a lot of
10:36 Bitcoin when the price is just going
10:37 crazy. It’s way, way, way better to make
10:40 the decision to buy Bitcoin when the
10:42 price is not going crazy. Now, the good
10:44 news is the price is not going crazy
10:45 right now. Uh that doesn’t mean we’re
10:47 not sitting at 117,000. And so, you
10:50 know, it’s it’s not, you know, it’s not
10:53 at a ultra deep discount compared to the
10:55 recent past. Um, but it is, you know,
10:58 below its all-time high. And we’ve been
11:00 grinding around sidewaysish,
11:02 you know, in the $100,000 range for 3 or
11:05 4 months now, which means it feels like
11:07 it can go higher and sustainably. So,
11:10 so, do I think it’s a good time to buy
11:12 Bitcoin? Yes. It’s never a bad time to
11:13 buy Bitcoin. And it’s a lot easier
11:15 decision to buy Bitcoin right now than
11:18 to wait for a huge parabolic rise,
11:20 suddenly get intense fear of missing out
11:22 and be stuck because I know what’s going
11:24 to happen. The prices, if it does go
11:26 through a parabolic rise like that,
11:27 people are going to be texting me as the
11:29 price, you know, leaps from 120 to 140
11:31 to 160. There’s going to be all these
11:33 people texting me and messaging me on
11:35 Facebook Messenger saying, “Okay, Joel,
11:37 I’m convinced. I should have listened to
11:38 you all all along. Now I’m ready to buy
11:40 Bitcoin. Should I buy Bitcoin now?” And
11:42 I’m going to say the same thing I always
11:44 say. Well, it’s unfortunate that you
11:46 waited for $160,000 Bitcoin instead of
11:49 buying $120,000 Bitcoin. It’s never a
11:52 bad time to buy Bitcoin, but it was a
11:54 better time to buy Bitcoin before this
11:56 huge price rise. So, don’t let the price
11:59 of an asset be your determinant of
12:02 whether you think it’s a good investment
12:03 because that means you’re only ever
12:05 buying it after a big price increase.
12:07 And the best time to buy anything is
12:09 when it’s steeply discounted. And the
12:11 next best time is when it’s discounted.
12:13 And the next best time is when the price
12:14 is boring and grinding sideways, which
12:16 is kind of where we are in Bitcoin right
12:18 now. Uh the worst time to buy any asset,
12:21 again, never a bad time to buy Bitcoin,
12:23 but the the least good time to buy
12:25 Bitcoin is when it’s in a huge parabolic
12:28 price run and everybody on the planet’s
12:30 talking about it and everybody, you
12:32 random person is buying Bitcoin for the
12:34 first time and has no idea what it is.
12:36 and you’re stuck in that c, you know,
12:38 you’re stuck up there buying $160,000
12:40 Bitcoin with the masses. That is not
12:42 where you want to be. You want to have
12:43 bought all your Bitcoin before it does
12:45 that. Um, and that way you can just ride
12:47 it out. And is it sustainable? Is it not
12:49 sustainable? Doesn’t matter in the long
12:51 term it’ll be a lot higher. So, who
12:52 cares if at the short term, you know,
12:55 one price is sustainable or not
12:56 sustainable? It just doesn’t matter
12:58 because if you’re holding it for the
12:59 long term, then who cares if uh, you
13:01 know, the price bounces around? It goes
13:03 high, it goes low, it comes back, it
13:05 reverses. It just none of that matters
13:07 as long as you have a long-term focus
13:10 and you can just ride it out. So, where
13:13 I am with 100% Bitcoin allocation,
13:15 meaning all of my liquid assets are in
13:16 Bitcoin. I do not own any stocks, any
13:18 bonds, or any US dollar cash. My wife
13:21 does manage a small emergency reserve
13:23 fund that is not in Bitcoin because I
13:25 have a very high risk tolerance and I
13:27 wanted her to manage some money uh that
13:30 was in that was not allocated the same
13:32 way I allocate it. But for all the money
13:34 which is the vast majority of our wealth
13:36 that I control or manage or oversee, it
13:39 is 100% Bitcoin. And I feel great about
13:42 that. And you know what? Are four-year
13:44 cycles over? I don’t even care. If they
13:46 are over, great. If they aren’t over,
13:48 great. I don’t care because I’m already
13:50 allocated. And if you’re already
13:51 allocated, you don’t have to care. If
13:53 you’re not allocated, then the price is
13:55 going to take off and then you’re going
13:56 to be in a tough spot trying to decide
13:58 whether you want to buy $140,000
13:60 Bitcoin, $160,000 Bitcoin, or $200,000
14:03 Bitcoin. And it’s just a lot easier to
14:04 make that decision right now when we’re
14:06 not there.
