The Bitcoin market has long been defined by its seemingly immutable four-year cycle, a pattern of three years of surging prices followed by a sharp correction. However, a seismic shift in policy from Washington, led by former President Donald Trump, may shatter this cycle and usher in a new era of prolonged growth for the cryptocurrency industry.
The Four-Year Cycle: A Recap
Matt Hougan, Chief Investment Officer at Bitwise Asset Management, recently posed an intriguing question: Can Trump’s Executive Order break crypto’s four-year cycle? His answer, though nuanced, leans towards an emphatic yes.
Hougan clarifies his personal belief that the four-year Bitcoin market cycle is not driven by Bitcoin's halving events. He states, "People try to link it to bitcoin’s quadrennial 'halving,' but those halvings are misaligned with the cycle, having occurred in 2016, 2020, and 2024."
Bitcoin’s four-year cycle has been historically driven by a mix of investor sentiment, technological breakthroughs, and market dynamics. Typically, a bull run emerges following a significant catalyst—be it infrastructure improvements or institutional adoption—which attracts new capital and fuels speculation. Over time, leverage accumulates, excesses emerge, and a major event—such as regulatory crackdowns or financial fraud—triggers a brutal correction.
The Executive Order: A Game Changer
The fundamental question Hougan explores is whether Trump’s recent Executive Order, which prioritizes the development of the digital asset ecosystem in the U.S., will disrupt the established cycle. The order, which outlines a clear regulatory framework and even envisions a national digital asset stockpile, represents the most bullish stance on Bitcoin from any sitting or former U.S. president.
The implications are profound:
- Regulatory Clarity: By eliminating legal uncertainty, the EO paves the way for institutional capital to flow into Bitcoin at an unprecedented scale.
- Wall Street Integration: With the SEC and financial regulators now pro-crypto, major banks can enter the space, offering Bitcoin custody, lending, and structured products to their clients.
- Government Adoption: The concept of a national digital asset stockpile hints at a future where the U.S. Treasury could hold Bitcoin as a reserve asset, solidifying its status as digital gold.
The End of Crypto Winters?
If history were to repeat itself, Bitcoin would continue its ascent through 2025 before facing a significant pullback in 2026. However, Hougan suggests this time may be different. While he acknowledges the risk of speculative excess and leverage-driven bubbles, he argues that the sheer scale of institutional adoption will prevent the kind of prolonged bear markets seen in the past.
This is a crucial distinction. In previous cycles, Bitcoin lacked a strong base of value-oriented investors. Today, with ETFs making it easier for pensions, hedge funds, and sovereign wealth funds to allocate to Bitcoin, the asset is no longer solely dependent on retail enthusiasm. The result? Corrections may still occur, but they will likely be shallower and shorter-lived.
What Comes Next?
Bitcoin has already crossed the $100,000 mark, and projections from industry leaders, including BlackRock CEO Larry Fink, suggest it could reach $700,000 in the coming years. If Trump’s policies accelerate institutional adoption, the typical four-year pattern could be replaced by a more traditional asset-class growth trajectory—akin to how gold responded to the end of the gold standard in the 1970s.
While risks remain—including unforeseen regulatory reversals and excessive leverage—the direction of travel is clear: Bitcoin is becoming a mainstream financial asset. If the four-year cycle was driven by Bitcoin’s infancy and speculative nature, its maturation may render such cycles obsolete.
Conclusion
For over a decade, investors have used the four-year cycle as a roadmap for Bitcoin’s market movements. But Trump’s Executive Order could be the defining moment that disrupts this pattern, replacing it with a more sustained and institutionally-driven growth phase. As Wall Street, corporations, and even governments increasingly embrace Bitcoin, the question is no longer if crypto winter will come in 2026—but rather if it will come at all.
Disclaimer: This article is intended for informational purposes only and does not constitute financial advice. Readers are encouraged to conduct thorough independent research before making investment decisions.
Frequently Asked Questions
What's the advantage of a Gold IRA?
There are many advantages to a gold IRA. It can be used to diversify portfolios and is an investment vehicle. You decide how much money you want to put into each account, and when you want it to be withdrawn.
You also have the option to roll over funds from other retirement accounts into a gold IRA. This allows you to easily transition if your retirement is early.
The best part? You don’t need to have any special skills to invest into gold IRAs. They're available at most banks and brokerage firms. You do not need to worry about fees and penalties when you withdraw money.
There are also drawbacks. Gold is historically volatile. It is important to understand why you are investing in gold. Do you want safety or growth? Do you want to use it as an insurance strategy or for long-term growth? Only after you have this information will you make an informed decision.
If you plan on keeping your gold IRA alive for a while, you may want to consider purchasing more than 1 ounce of pure gold. You won't need to buy more than one ounce of gold to cover all your needs. Depending upon what you plan to do, you could need several ounces.
You don’t necessarily need a lot if you’re looking to sell your gold. Even one ounce is enough. But you won't be able to buy anything else with those funds.
How much do gold IRA fees cost?
The Individual Retirement Account (IRA), fee is $6 per monthly. This includes account maintenance and any investment costs.
To diversify your portfolio you might need to pay additional charges. These fees will vary depending upon the type of IRA chosen. Some companies offer free checking accounts, but charge monthly fees to open IRA accounts.
A majority of providers also charge annual administration fees. These fees vary from 0% to 11%. The average rate for a year is.25%. However, these rates are typically waived if you use a broker like TD Ameritrade.
How do I Withdraw from an IRA with Precious Metals?
First decide if your IRA account allows you to withdraw funds. Then make sure you have enough cash to cover any fees or penalties that may come with withdrawing funds from your retirement plan.
You should open a taxable brokerage account if you're willing to pay a penalty if you withdraw early. If you decide to go with this option, you will need to take into account the taxes due on the amount you withdraw.
Next, figure out how much money will be taken out of your IRA. This calculation is dependent on several factors like your age when you take the money out, how long you have had the account, and whether or not your plan to continue contributing.
Once you know how much of your total savings to convert to cash, it's time to choose the type of IRA that you want. Traditional IRAs permit you to withdraw your funds tax-free once you turn 59 1/2. Roth IRAs have income taxes upfront, but you can access the earnings later on without paying additional taxes.
Once you have completed these calculations, you need to open your brokerage account. A majority of brokers offer free signup bonuses, as well as other promotions, to get people to open accounts. You can save money by opening an account with a debit card instead of a credit card to avoid paying unnecessary fees.
You will need a safe place to store your coins when you are ready to withdraw from your precious metal IRA. Some storage facilities can accept bullion bar, while others require you buy individual coins. Before choosing one, consider the pros and disadvantages of each.
Bullion bars require less space, as they don't contain individual coins. However, each coin will need to be counted individually. However, individual coins can be stored to make it easy to track their value.
Some people prefer to keep their coins in a vault. Others prefer to place them in safe deposit boxes. Whatever method you choose to store your bullion, you should ensure it is safe and secure so you can enjoy its many benefits for many years.
How to open a Precious Metal IRA
The first step is to decide if you want an Individual Retirement Account (IRA). If you do, you must open the account by completing Form 8606. You will then need to complete Form 5204 in order to determine which type IRA you are eligible. This form must be submitted within 60 days of the account opening. You can then start investing once you have this completed. You might also be able to contribute directly from the paycheck through payroll deduction.
For a Roth IRA you will need to complete Form 8903. Otherwise, it will be the same process as an ordinary IRA.
To be eligible for a precious metals IRA, you will need to meet certain requirements. The IRS requires that you are at least 18 years old and have earned an income. For any tax year, your earnings must not exceed $110,000 ($220,000 for married filing jointly). You must also contribute regularly. These rules apply regardless of whether you are contributing directly to your paychecks or through your employer.
You can invest in precious metals IRAs to buy gold, palladium and platinum. However, physical bullion will not be available for purchase. This means you won't be allowed to trade shares of stock or bonds.
You can also use your precious metals IRA to invest directly in companies that deal in precious metals. Some IRA providers offer this option.
An IRA is a great way to invest in precious metals. However, there are two important drawbacks. First, they don't have the same liquidity as stocks or bonds. It is therefore harder to sell them when required. They also don't pay dividends, like stocks and bonds. So, you'll lose money over time rather than gain it.
Statistics
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- You can only purchase gold bars at least 99.5% purity. (forbes.com)
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
External Links
wsj.com
- Saddam Hussein's InvasionHelped Uncage a Bear In 90 – WSJ
- Want to Keep Gold in Your IRA at Home? It's not exactly legal – WSJ
forbes.com
- Gold IRA, Add Sparkle to Your Retirement Nest egg
- Understanding China's Evergrande Crisis – Forbes Advisor
investopedia.com
- Are You a Good Candidate for a Gold IRA
- What are the Options Types, Spreads, Example, and Risk Metrics
bbb.org
How To
How to keep physical gold in an IRA
The best way of investing in gold is to purchase shares from companies that produce gold. But this investment method has many risks as there is no guarantee of survival. Even if they do survive, there is still the possibility of losing money to fluctuating gold prices.
An alternative option would be to buy physical gold itself. You will need to either open an online or bank account or simply buy gold from a reliable seller. These options offer the convenience of easy access, as you don't need stock exchanges to do so. You can also make purchases at lower prices. It is easier to view how much gold has been stored. So you can see exactly what you have paid and if you missed any taxes, you will get a receipt. You are also less likely to be robbed than investing in stocks.
However, there can be some downsides. Bank interest rates and investment funds won't help you. You won't have the ability to diversify your holdings; you will be stuck with what you purchased. Finally, the tax man might ask questions about where you've put your gold!
If you'd like to learn more about buying gold in an IRA, visit the website of BullionVault.com today!
—————————————————————————————————————————————————————————————-
By: Mark Mason
Title: The Impact of Trump's Executive Order on Bitcoin's Four-Year Cycle
Sourced From: bitcoinmagazine.com/markets/will-trumps-executive-order-break-bitcoins-four-year-market-cycle-
Published Date: Thu, 30 Jan 2025 17:24:24 GMT
