Anyone who has studied Bitcoin charts long enough learns a heuristic: every four years a new bull run, every four years a new top, every four years a long bear market. On-chain analysis has elegantly confirmed this for years — long-term holder supply (LTH, defined as coins not moved for more than 155 days) falls during bull markets, because old hands sell to new hands. In bear markets the opposite: STH supply shrinks, LTH supply grows monotonically.
Until 2021, this ran in one rhythm per halving period. One distribution wave, one top, one crash, one accumulation phase. Clean, readable, predictable.
The current cycle has broken that pattern. And the question isn't whether it broke it — but what it means that it broke it.
What we actually see
Since early 2024, multiple on-chain analysts — CoinDesk, CryptoQuant, André Dragosch, CCN — have documented three separate waves in which LTH supply was distributed:
Wave 1, Q1 2024 — the ETF launch. Spot Bitcoin ETFs were approved in the US in January 2024. Bitcoin rallied from roughly $25,000 to near $73,000 by March 2024. LTH sold into this first major institutional demand.
Wave 2, Q4 2024 — the 100k break. Halving in April, Trump election in November, first $100,000 touch in December. Second distribution wave, driven by macro optimism and fresh ETF inflows.
Wave 3, summer–autumn 2025 — the run to the October top. After a spring 2025 pullback, Bitcoin pushed into a third wave through the October peak. CoinDesk documented in December 2025 that LTH supply had fallen to an eight-month low — the third distinct distribution wave of this cycle.
That's qualitatively different from 2017 or 2021. Back then it was one long distribution, here it's three discrete sell-the-rally events. The LTH curve no longer writes a V but a staircase down — and after each wave a brief accumulation phase before the next starts.
Four possible readings
Before getting to conclusions, it's more honest to stack several explanation candidates against each other.
Reading 1 — the structural liquidity thesis. The institutional buyer layer since 2024 has a completely different size than before. Spot ETFs, MicroStrategy/Strategy with their ATM program, other Bitcoin treasury companies, sovereign wealth funds in first conversations. There are now multiple large demand clusters that can be triggered independently of each other — and each trigger absorbs a wave of LTH supply. Pro: the timing correlation fits cleanly. Con: ETF inflow data doesn't show three perfectly separate waves but rather two clear ones and one weaker one.
Reading 2 — cycle decomposition. The old 4-year halving mechanic had a clear driver: supply shock every four years. With each halving, the relative supply shock has shrunk — 50 percent of 50 BTC/block matters more than 50 percent of 6.25 BTC/block. What remains is demand-driven cycle. And demand no longer arrives in clean 4-year rhythm but in irregular waves driven by macro events — rates, ETFs, elections, regulation. In this reading, the three-wave pattern would be the new normal: shorter, more frequent mini-cycles instead of long halving cycles. Pro: also explains why drawdowns between waves were shallower than historical bear markets. Con: we've only seen one cycle with this pattern.
Reading 3 — the holder composition has changed. André Dragosch pointed out in November 2025 that the LTH-to-STH transfer in this cycle doesn't go in the classical sense to late-coming retail, but to institutional wrappers — ETFs, BTC treasury companies, sovereigns. That's methodologically interesting because the coins are technically classified as STH the moment they change wallet, but the actual holder behavior is completely different than retail STH. An ETF holder doesn't rotate in panic but holds quarter after quarter. In this reading, the three-wave distributions are less a top indicator and more a successive shift from old money to institutional money — and the non-existent retail FOMO at the top is the actual information.
Reading 4 — methodological skepticism. The 155-day cutoff is arbitrary. It works well when holders show clear behavior. But when new holder profiles enter — ETF holders who hold via brokerage accounts and produce no clean on-chain signature, or custody solutions that move coins between wallets without real holder change — the metric itself gets noisy. Pro: honest explanation for why patterns that worked for years suddenly look different. Con: large on-chain providers partially correct for this, so the explanation can't carry everything.
What the combination makes likely
The most honest answer isn't one of these readings but a combination of Readings 1, 2, and 3. Multiple independent institutional demand triggers plus exhausted halving cyclicality plus qualitatively different holder composition produce a wave pattern instead of a monolithic bull run.
What this means for market reading can be stated in three sober points.
First, the old 4-year heuristic is methodologically damaged. Anyone who used 2017 plus 4 equals 2021 plus 4 equals 2025 as a top forecast model might have accidentally been right in October 2025, but for the wrong reasons. Tops are now a function of institutional inflow timing, not a function of the halving calendar. This changes the viability of any strategy built on 4-year cyclicality.
Second, distribution becomes harder to time. One large V-top with a classical euphoria phase is easier to identify than three separate waves, each of which looks like a local top in its own right. The trader heuristic "I sell when euphoria is maximum" doesn't work anymore when there are three euphoria peaks and the third might be a reversal but might not be. The top assumption made in March 2024 turned out to be premature. The one in December 2024 too. The one in October 2025 — that will only show in the course of 2026.
Third, backtests with 2013, 2017, and 2021 as reference cycles become less informative, not more. Three historical observations are statistically thin anyway. If the fourth time now runs qualitatively different, the data basis for cycle strategies gets even thinner. That's an uncomfortable truth for anyone who uses "after this cycle we saw XYZ, so now it'll happen again" as an argument.
What stays actionable
If the top doesn't reliably come in 4-year rhythm anymore and distribution spreads across multiple smaller waves, what do you do?
The anti-answer first: you don't try to call the top. It doesn't work reliably in a clear cycle — and definitely not in an unclear one. Anyone who spent the past year trying to identify "the top" has been right three times and left money on the table twice.
What works: systematic profit-taking rules that don't depend on top recognition. Concretely, this means position scaling via predefined price bands or volatility thresholds or drawdown profiles, tested and executed under stress. A rule like "sell 10 percent of the position per 20 percent rise above threshold X" produces no perfect exit, but it also produces no position that gets fully given back in the next drawdown.
A second implication: anyone claiming to have surely identified the distribution while it's happening is projecting clarity that doesn't exist in the moment. In March 2024 we didn't know that was only the first of three waves. In December 2024 many thought that was the top. In October 2025 many thought it was the top again. Maybe it's correct this time, maybe it's wave four. The honest reading accepts this fuzziness as a property of the market, not an analytical deficit.
What Backtesting Arena does here
Backtesting Arena is a platform for systematic strategy validation. It doesn't provide cycle top forecasts, because nobody can do that reliably. What it provides is the ability to test profit-taking strategies and risk-management rules against historical Bitcoin data — across all prior cycles, including messy transitions.
What that's practically worth: if your strategy is based on a fixed take-profit threshold, for example, you can see how it would have performed across 2013, 2017, 2021, and the current three-wave cycle. You don't get a guarantee for the next cycle, but you get a sense of the range of outcomes your rule would have produced. That's methodologically more honest than hoping the next top looks like the last one.
The strategies that work halfway consistently across multiple structurally different cycles are candidates for the future. The strategies that would only have worked in one specific cycle are anecdotes, not methods.
FAQ
Does that mean the current top was October 2025? We don't know. There are arguments for it (cumulative LTH distribution at historically high levels, MVRV in red territory) and arguments against (holder shift to institutional wrappers rather than retail, which historically didn't produce real tops). Anyone claiming a sure answer is selling something.
Does this break the halving theory completely? Not completely, but materially. The halving supply shock gets mathematically smaller with each cycle. The demand side gets more diversified with each cycle (ETFs, treasury companies, sovereigns). Both trends together shift Bitcoin from a supply-driven to a demand-driven asset. The 4-year pattern was a supply-driven property. It will be less dominant in the future.
Why don't we see classical retail FOMO at the top? One plausible answer: because retail this time bought primarily via ETFs, not directly on-chain. The FOMO is there but doesn't produce the typical on-chain signatures. The other answer: because retail was heavily decimated in 2022/23 and the 2024/25 holder base was structurally less retail-driven.
If the heuristic breaks — how should I trade? That's exactly the wrong frame. The question isn't "how do I trade on a broken heuristic" but "which strategy works systematically, regardless of whether the next period looks like an old one or not?" Answer comes from backtests across multiple structurally different cycles, not from tweaking a single heuristic.