Bitcoin (BTC) has now passed the one-year mark since its latest halving event, and the current market cycle is unfolding in a notably different manner. Unlike previous cycles that saw explosive post-halving rallies, BTC’s price has increased by a modest 31% during this period—a stark contrast to the 436% surge witnessed in the last cycle around the same time.
Key on-chain metrics, such as the MVRV ratio for long-term holders, also indicate a pronounced decline in unrealized profits. This suggests a maturing market with more compressed upside potential. Together, these signals point toward a new phase for Bitcoin: one characterized not by parabolic peaks, but by gradual, institution-driven growth.
Understanding Bitcoin Halving and Its Historical Impact
A Bitcoin halving is a scheduled event that reduces the block reward granted to miners by 50%. This mechanism, embedded in Bitcoin’s code, occurs approximately every four years and is designed to control inflation by slowing the rate at which new BTC enters circulation.
Historically, halvings have been associated with major bull markets. Reduced selling pressure from miners, combined with steady or growing demand, often led to substantial price increases in the months following the event. These cycles were typically fueled by retail speculation, hype-driven investment, and relatively low market capitalization, which allowed for high volatility and rapid price appreciation.
In the 2016–2020 cycle, for example, Bitcoin’s price rose dramatically in the year following the halving. A similar pattern occurred in the cycle that followed. Investors and traders came to see the halving as a reliable catalyst for bullish momentum.
How This Cycle Diverges from the Past
The current cycle breaks noticeably from historical patterns. Rather than accelerating after the halving, Bitcoin’s price began rising significantly earlier—with major upward moves occurring in October and December 2024. This was followed by a consolidation phase in January 2025 and a noticeable pullback in late February.
This pre-halving price action is a clear deviation from past cycles, where the halving itself typically served as the primary trigger for a sustained uptrend.
Several factors help explain this shift. Bitcoin is increasingly treated as a mature financial asset, not solely a speculative instrument. Growing participation from institutional investors, evolving regulatory frameworks, and broader macroeconomic conditions—such as interest rate fluctuations and liquidity cycles—are all contributing to a more measured and complex market response.
Moreover, each successive cycle has shown diminishing returns in percentage terms. As Bitcoin’s market cap expands, achieving the same exponential growth becomes mathematically more challenging. The 436% gain in the year following the 2020 halving has given way to a more subdued 31% increase this time around.
This doesn’t necessarily imply a weaker cycle, but rather a different kind of growth—one that may be slower but also more durable and structurally sound.
Long-Term Holder MVRV Ratio Signals Market Maturation
The MVRV (Market Value to Realized Value) ratio for long-term holders (LTHs) is a key on-chain metric that reflects the unrealized profit held by investors who have retained their BTC for at least 155 days. It serves as a reliable indicator of market sentiment and potential selling pressure.
In previous cycles, the LTH MVRV ratio reached extreme levels. During the 2016–2020 cycle, it peaked at 35.8, indicating enormous paper profits and typical market euphoria. In the following cycle (2020–2024), the peak declined significantly to 12.2—even as Bitcoin’s price reached new all-time highs.
In the current cycle, the maximum LTH MVRV ratio recorded so far is just 4.35. This sharp decline suggests that long-term holders are seeing much lower profit multiples compared to past cycles, despite strong price performance.
This compression in unrealized gains signals that the market is maturing. As Bitcoin’s adoption grows and its investor base becomes more institutional, the days of extreme cyclical profits may be fading. Instead, we may be entering an era of more stable, gradual appreciation.
Institutional Adoption Is Reshaping Bitcoin’s Growth Trajectory
One of the most significant factors behind this cycle’s unique behavior is the substantial inflow of institutional capital. The approval of Bitcoin ETFs in major markets like the United States has provided a streamlined, regulated avenue for corporations and investment funds to gain exposure to BTC.
Unlike retail investors, institutions often employ dollar-cost averaging and longer investment horizons. Their presence can dampen short-term volatility while contributing to sustained underlying demand.
This shift is also reflected in changing holding patterns. Large holders (“whales”) are accumulating Bitcoin not for quick trades, but as a long-term store of value or inflation hedge. This behavior reduces the available supply on exchanges, which can suppress dramatic price swings—both upward and downward.
In many ways, Bitcoin is transitioning from a high-risk, high-reward asset into a more stable component of diversified investment portfolios.
Macroeconomic Factors Influencing Bitcoin’s Performance
It’s impossible to analyze Bitcoin’s performance in isolation. Broader economic conditions play an increasingly important role in shaping its price action.
Interest rates, inflation expectations, and global liquidity cycles all affect investor appetite for risk assets, including cryptocurrencies. In periods of tightening monetary policy, for example, investors may reduce exposure to speculative assets. Conversely, expansive fiscal or monetary measures can drive capital into crypto markets.
This cycle has coincided with a complex macroeconomic environment—including fluctuating rate policies, geopolitical tensions, and currency devaluation concerns in several countries. These factors may be contributing to a more cautious, steady ascent in Bitcoin’s price rather than a hype-driven explosion.
Frequently Asked Questions
What is Bitcoin halving?
Bitcoin halving is a pre-programmed event that cuts the reward for mining new blocks in half. It occurs every 210,000 blocks—approximately every four years—and reduces the rate at which new BTC enters circulation.
Why is this cycle different from previous ones?
This cycle features earlier price peaks, more institutional involvement, and less dramatic unrealized profit margins for long-term holders. Macroeconomic factors and increased market maturity are also playing a larger role.
Does a lower MVRV ratio mean Bitcoin is no longer profitable?
Not at all. It indicates that profits are less extreme compared to earlier cycles, but Bitcoin can still deliver attractive returns—especially for those who invest with a long-term perspective.
Are we still in a bull market?
Many analysts believe so, but the characteristics of the bull market have changed. Growth is becoming more gradual and structurally supported, rather than driven purely by retail speculation.
Should investors adjust their strategies based on these changes?
Yes. Strategies that worked in earlier cycles may not be as effective today. Longer holding periods, disciplined accumulation, and attention to macro trends are becoming more important.
How can I track these metrics myself?
You can monitor on-chain data using glassnode or other analytics platforms, and follow market trends through trusted crypto news sources. 👉 Explore real-time market analytics
Conclusion: Embracing a New Phase for Bitcoin
Bitcoin is growing up. The declining volatility, compressed profit multiples, and increased institutional participation all point toward a market that is evolving from its speculative origins into a more mature financial asset.
This doesn’t mean that Bitcoin has lost its potential for growth. Rather, it suggests that future gains may be more sustainable, less erratic, and driven by different factors than in the past.
Investors who adapt to this new reality—embracing longer time horizons and deeper fundamental analysis—may find that Bitcoin remains a compelling asset, even in a changing cycle.