The "Bitcoin Reserve Act" May Break the Cryptocurrency Four-Year Cycle

Background and Progress of the Bill

- Wyoming Senator Cynthia Lummis proposed the "2024 Bitcoin Bill," which plans for the U.S. government to purchase 200,000 bitcoins annually over five years, accumulating 1 million and holding them for at least 20 years. Similar proposals are also being considered in Texas, Pennsylvania, and other states, while Russia, Thailand, Germany, and others are contemplating related proposals. Additionally, there are speculations that Trump may sign relevant executive orders or promote legislation to establish reserves, but his team has not directly confirmed the executive order claims, and executive orders lack stability; legislation is the reliable way to ensure the long-term future of Bitcoin's strategic reserves. However, the bill's progress also faces risks of derailment due to a few Republican defectors.

Analysis of Possible Reasons for Breaking the Four-Year Cycle

1. Views Related to Supercycles:

- This time there are many favorable conditions, such as Trump's nomination supporting cryptocurrency and relaxed regulations for key positions. Some believe Bitcoin may be in a supercycle, which is different from past situations. However, every previous Bitcoin bull market has seen claims of a "cycle unlike others" that have not materialized, and supercycle theories often lead to adverse outcomes, representing a collective delusion.

- However, given the unprecedented bullish conditions like presidential support in the U.S., if the bill passes, it may trigger a global coin hoarding competition, leading other countries to follow suit, changing market supply and demand dynamics, and creating a market cycle different from past ones.

2. Impact of Changes in Investor Structure:

- If countries become market buyers, new investors from global financial centers will flood in, altering the market's current state driven by retail trading. Institutional investors have substantial funds and advanced risk management strategies, and their behavior differs from retail investors. As Wall Street and others participate, the market may become more stable with reduced volatility, and bear markets may not be as aggressive as in the past, thereby affecting the original four-year cycle.

- Furthermore, Bitcoin's price movements are increasingly influenced by external factors such as institutional adoption and geopolitical events, no longer limited to internal mechanisms like halving. It is hard to imagine that subsequent halvings will follow a predictable four-year pattern, and currently, Bitcoin's price performance in this cycle is already different from the previous four-year cycles. Therefore, from multiple perspectives, it may break the four-year cycle.#加密市场反弹 #BTC