Popular Analyst Justin Bennett explained why Bitcoin’s four-year cycle could end in the foreseeable future. He indicated that the cryptocurrency’s projected price growth during this market cycle may not happen as planned and that Bitcoin could suffer sedate price crash coming soon.

Why Bitcoin’s Four-Year Cycle Could Be Coming to an End

WX (formerly Twitter) fastingBennett said Bitcoin follows business cycles, explaining why the leading cryptocurrency could be on the cusp of a novel era. He noted that the leading cryptocurrency has followed the ideal four-year cycles since its inception, having witnessed two years of bear and bull markets.

However, he suggested that this could change, as Bitcoin’s correlation with business cycles means that a recession would end those four-year cycles. To prove that Bitcoin follows business cycles, Bennett highlighted how Bitcoin has tracked the U.S. Purchasing Managers Index (PMI) from the very beginning.

This index measures the health of the economy using the manufacturing and services sectors. The accompanying chart shows that the price of BTC rose when the PMI did so, and fell when the index fell. In line with this, Bennett argued that the correlation would continue to exist during the next short-term or long-term decline.

Interestingly, this contraction may already be inevitable, which is why Bitcoin’s four-year cycle may end. US PMI is at the current price level of 47.20, which means a decline. A decline is when a country’s economy is degenerating, which can be said about the US right now because Federal Reserve fights to lower inflation to the desired level and avoid recession.

It is also worth mentioning that the economic situation in the US has contributed greatly to the stagnation of BTC prices since it reached novel all-time record (ATH) in March. Bitcoin investors remained cautious as US Inflation Data and employment reports showed how frail the US economy is.

What does this mean for the BTC price?

Bennett noted that Bitcoin’s correlation with business cycles does not mean its price cannot rise. However, he noted that people need to understand that BTC is a risk asset driven by post-2008 economic conditions. He added that it is not “programmed to go up” as cryptocurrency analysts have predicted, nor is it designed to follow “rainbow chart Or stock to flow model.”

The analyst’s perspective undoubtedly undermines the confident forecasts based on halving cycles. Historically, Bitcoin hits novel highs 16 to 18 months after a halving. However, Bennett suggests that this perfect cycle may end, this time it may not be. This cycle has already proven to be different, considering the flagship cryptocurrency reached a novel ATH before the halving, which has never happened before.

At the time of writing, Bitcoin is trading at around $57,900, down almost 1% in the past 24 hours, according to data data from CoinMarketCap.

Featured image created with Dall.E, chart from Tradingview.com