Bitcoin: Is Liquidity the Answer over the Four-Year Cycle? Why Prices Aren’t Rising Despite Oil Money Buying, and a Reinterpretation of the Bottom and Alt Season

As debates continue over whether Bitcoin’s four-year cycle has broken or still holds, our analysis highlights liquidity as the decisive variable. In the new environment shaped by spot ETF approvals and institutional participation, it is more important to verify the timing and strength of actual capital inflows than to mechanically apply past timelines. Meanwhile, accumulation by Middle Eastern oil money and sovereign wealth funds is a fact, but that alone does not guarantee a short-term rebound—an important difference in interpretation that investors should recognize.

Key Takeaways

The market’s direction is wavering between belief in the four-year cycle and the reality of liquidity. We do not endorse a mechanical application of the four-year cycle, yet we also draw a line against assuming an imminent, sharp rebound next year. In conclusion, near-term upside momentum looks weak, and a conservative stance is warranted until actual liquidity inflows are confirmed.

Is the Four-Year Cycle Truly Over?

We assign significant weight to the possibility that the structure changed after spot ETF approvals, which could have disrupted the traditional four-year cycle. Ironically, recent price action has also shown stretches that resemble the rhythm of that cycle. Both the assertion that “the cycle is broken so next year will rebound” and the view that “if the cycle holds, expect another 1–2 years of downside” can be premature when measured against the real-world variable of liquidity.

Liquidity Is the Answer: Rate Cuts and QE Expectations vs. Reality

Market consensus often assumes that once rate cuts and quantitative easing (QE) start in earnest, Bitcoin will recover quickly. We caution that expectations do not automatically equal actual capital inflows. Even if rate cuts materialize, it can take time for new money to flow into spot Bitcoin ETFs or direct spot purchases, implying a potentially extended accumulation period during which sideways action or further downside can persist. In risk assets, rebounds depend less on policy headlines and more on the timing of real liquidity entering the market.

Institutional, Oil Money, and Sovereign Wealth Flows: Facts vs. Optical Illusions

It is a fact that buying from Middle Eastern oil money and sovereign wealth funds has entered via the BlackRock spot ETF. Yet declining prices simultaneously imply larger selling pressure elsewhere, and institutional time horizons are not the same as those of retail investors. For example, just as Cathie Wood has floated a long-term target of $1.5 million per Bitcoin, early institutions can interpret the $50,000–$100,000 range as a long-horizon accumulation zone. For retail investors the same volatility can be damaging, so the simplistic logic that “institutions are buying, therefore price will soon rally” is risky.

Use Caution with On-chain and Sentiment Indicators: Fear & Greed and Bitfinex Longs

“Buy when there’s extreme fear” is a common refrain when the Fear & Greed Index flashes panic, but if the market lacks strength, the fear zone does not necessarily mark a bottom. Historically, deep bear markets have extended with additional declines and prolonged stagnation even after fear readings. Similarly, treating rising Bitfinex long positions as a definitive “accumulation complete” signal is hazardous; during the 2021–2022 downcycle, long positioning increased while prices kept falling. Indicators must be read in context, particularly alongside evidence of liquidity actually being present.

Bottom and Duration: Psychology Must Crack Before the Numbers

We avoid pinning down a precise bottom. Our personal view is that the downside may not extend far below $70,000, but above all, we judge that a clear advance is unlikely in the near term. A true bottom is less about a specific price print and more about a phase where market psychology fully breaks, such that even small bounces are met with hesitation and sidelining.

Alt Season May Have Arrived via a Different Route

Many investors expect a broad, simultaneous altcoin rally like 2020–2021 across Ethereum, Solana, and ADA. In this cycle, liquidity may have detoured into mining stocks and Bitcoin-sensitive equities instead. Capital rotation into listed miners such as MARA, HIVE, and HUT, as well as Bitcoin-related public companies, can be seen as a modified form of alt season. The advent of ETFs has diversified capital channels, potentially dampening the old pattern where most altcoins surged in unison.

Strategy: Cash Is King Until Confirmation

From a trading perspective, we are wary of expectation-driven bets such as “QE is coming next year, so a rebound is imminent.” Long-term investors can continue dollar-cost averaging through drawdowns, but for short-term traders it is more rational to stay conservative until confirmation signals emerge for real liquidity inflows and a trend reversal. If handed 100 million KRW today, we would hold stablecoins (USD) for now. The aim is to sidestep volatility risk until a turn is confirmed and to retain flexibility to enter when the opportunity is clearer.

Bottom Line: Focus on the Actual Flow of Funds, Not the Cycle

We stress liquidity as the variable that cuts through the market’s opposing narratives. Institutional and oil-money inflows are real, but rather than expecting a swift spike on a retail time horizon, investors should first look for confirmation of the sequence: policy shift → actual capital deployment → tangible improvement in supply–demand. Instead of fixating on a single “bottom” number, monitor psychological capitulation and the repair of order flow, and prepare for the possibility that alt season routes through mining stocks and Bitcoin-sensitive equities—a new pathway for capital in the cryptocurrency and blockchain investment landscape.