Bitcoin News Today: Bitcoin Becomes Global Liquidity Barometer as Four-Year Cycle Fades

Bitcoin's traditional four-year market cycle, long tied to halving events and bear market peaks, is no longer a reliable predictor of price movements, according to Arthur Hayes, co-founder of Maelstrom. In a recent essay, Hayes argues that Bitcoin's price trends are now driven by global liquidity and monetary policy rather than timing-based patterns. This shift, he claims, invalidates the historical link between halvings and market downturns, which previously saw Bitcoin's price drop 70–80% from bull peaks in 2014, 2018, and 2022.

Hayes attributes these prior corrections to monetary tightening in major economies, not the halving events themselves. For example, the 2013 bull run collapsed as the U.S. Federal Reserve and Chinese central bank slowed quantitative easing and credit expansion. Similarly, the 2017 ICO-driven surge waned as Chinese credit growth decelerated, and the 2020–2021 rally ended when the Fed began tightening. The current cycle, however, differs due to accommodative policies. The U.S. Treasury has injected $2.5 trillion into markets via Treasury bill issuance, while President Donald Trump's pro-growth agenda and plans for bank deregulation aim to stimulate economic activity. The Fed has also resumed rate cuts, with futures markets pricing in a 94% probability of a cut in October and 80% in December.

China's role in this dynamic is also evolving. While Beijing has not been as stimulatory as in previous cycles, Hayes notes that its focus on ending deflation-rather than draining liquidity-supports Bitcoin's price. This contrasts with prior cycles where Chinese deflationary policies counteracted U.S. liquidity injections. With both Washington and Beijing prioritizing cheaper and more abundant money, Hayes predicts Bitcoin will continue rising in anticipation of sustained monetary expansion.

Current market conditions reinforce this outlook. Bitcoin recently traded near $122,000, with inflows into BlackRock's iShares Bitcoin Trust (IBIT) and spot ETFs reaching $3.2 billion in October 2025. On-chain data shows open interest on Binance fell nearly 8% after hitting $15.07 billion, indicating profit-taking but not a bearish reversal. Meanwhile, global liquidity injections from China, the U.S., and Europe-such as China's ¥1.1 trillion reverse repo operation and Japan's pro-stimulus political shift-further bolster Bitcoin's role as a hedge against fiat depreciation.

Hayes' analysis aligns with broader macroeconomic trends. Institutions and analysts increasingly view Bitcoin as a barometer of global liquidity, with its price rising in tandem with money supply expansions. A study by Lyn Alden's team found Bitcoin moves in the same direction as global M2 liquidity 83% of the time over 12-month periods, outperforming other assets. This sensitivity is attributed to Bitcoin's fixed supply and lack of earnings or dividends, making it uniquely responsive to liquidity shifts.

The U.S. government's Bitcoin holdings, including 213,000 BTC from seizures, and corporate investments by firms like MicroStrategy underscore growing institutional acceptance. Meanwhile, regulatory developments such as the proposed FIT21 Act aim to clarify crypto oversight, potentially unlocking broader adoption. As central banks continue to expand liquidity and governments prioritize economic stimulus, Bitcoin's trajectory appears tied to these macro forces rather than the outdated halving narrative.

Source: [1] Bitcoin Crash Off the Table as Four-Year Cycle is Dead: Arthur Hayes (https://www.coindesk.com/markets/2025/10/09/bitcoin-crash-off-the-table-as-four-year-cycle-is-dead-arthur-hayes)

[2] Arthur Hayes: Bitcoin 4-Year Cycle Is Now Dead - Coinspeaker (https://www.coinspeaker.com/arthur-hayes-bitcoin-4-year-cycle-dead/)

[3] Arthur Hayes: Bitcoin's Four-Year Cycle Is Dead - Cointelegraph (https://cointelegraph.com/news/real-reason-4-year-cycle-is-dead-arthur-hayes)

[4] Bitcoin's 4-Year Cycle is Dead and Money Printing Killed It (https://coincentral.com/bitcoins-4-year-cycle-is-dead-and-money-printing-killed-it/)

[5] Bitcoin: A Global Liquidity Barometer - Lyn Alden (https://www.lynalden.com/bitcoin-a-global-liquidity-barometer/)