Bitcoin Halving Market Analysis One Year Later: New Cycle Shows Different Characteristics

It has been a year since the last Bitcoin Halving event, and this market cycle exhibits characteristics that are distinctly different from previous years. Compared to the drastic increase seen after past halvings, this time Bitcoin's rise has been relatively moderate, with an increase of only 31%. In contrast, the previous cycle saw an increase of up to 436% during the same period.

At the same time, long-term holder indicators (such as the MVRV ratio) show a significant decline in unrealized profits, indicating that the market is maturing and upward potential is limited. Overall, these changes suggest that Bitcoin may be entering a new phase characterized not by explosive growth, but rather by a more institution-driven gradual growth.

The Uniqueness of This Bitcoin Cycle

The current development trajectory of the Bitcoin cycle is significantly different from the past, which may indicate that the market's response to the Halving event is changing.

In the early cycles (especially from 2012 to 2016, and from 2016 to 2020), Bitcoin often experienced strong upward trends during this phase. The period following the Halving is usually accompanied by strong upward momentum and parabolic price movements, mainly due to the enthusiasm and speculative demand from retail investors.

However, the current cycle presents a different pattern. The price did not accelerate after the Halving, but instead began to soar ahead of October and December 2024, followed by consolidation in January 2025 and a pullback in late February.

This behavior of rising in advance sharply contrasts with historical patterns, where past Halvings have typically served as triggers for significant increases.

The reasons for this shift are varied. Bitcoin is no longer merely a speculative asset driven by retail investors; it is increasingly being seen as a mature financial tool. The participation of institutional investors is constantly increasing, coupled with macroeconomic pressures and changes in market structure, leading to a more cautious and complex market response.

Another obvious sign of this evolution is that the intensity of each cycle is weakening. As the market value of Bitcoin grows, the explosive price increases seen in earlier years are becoming increasingly difficult to replicate. For example, in the cycle from 2020 to 2024, Bitcoin increased by 436% a year after the Halving. In contrast, the increase during the current cycle in the same time frame is only 31%, which is much more moderate.

This transformation may signify that Bitcoin is entering a new phase characterized by reduced volatility and more stable long-term growth. Halving may no longer be the primary driving force, as other factors such as interest rates, liquidity, and institutional funds are playing a greater role.

Nevertheless, it is worth noting that previous cycles have also experienced stages of consolidation and pullback before resuming an upward trend. While this stage may feel relatively slow or lacking in excitement, it may still represent a healthy adjustment before the next round of increase.

In other words, this cycle may continue to deviate from historical patterns. There may not be a dramatic top bubble burst, but rather a more sustained and structurally solid upward trend, driven more by fundamentals than speculation.

Long-Term Holder MVRV Ratio Reveals Market Maturity

The market value to realized value (MVRV) ratio of long-term holders (LTH) has always been a reliable indicator of unrealized profits. It shows the profits that long-term investors have made before they start selling off. However, over time, this value is declining.

During the cycle from 2016 to 2020, the LTH MVRV ratio peaked at 35.8, indicating substantial unrealized profits and a clear top forming. By the cycle from 2020 to 2024, this peak had sharply declined to 12.2, despite Bitcoin reaching an all-time high at that time.

During this cycle, the highest LTH MVRV ratio to date is only 4.35, a significant drop. This indicates that the profits gained by long-term holders are far lower than in previous cycles, despite the substantial increase in Bitcoin prices. This trend is evident: the profit multiples are declining in each cycle.

The explosive upside potential of Bitcoin is being compressed, and the market is maturing. This is not a coincidence. As the market matures, explosive returns are naturally harder to achieve. The era of extreme, cycle-driven profit multiples may be fading, replaced by more moderate or stable growth.

The continually growing market size means that exponentially more capital is needed to significantly drive prices up. However, this does not confirm that this cycle has peaked. Previous cycles typically included long periods of consolidation or slight pullbacks before reaching new highs.

As institutional investors play an increasingly important role, the accumulation phase may last longer. Therefore, the sell-off of peak profits may not be as sudden as in earlier cycles.

However, if the trend of the MVRV ratio peak decline continues, this may strengthen the view that Bitcoin is transitioning from a frenzy, cyclical surge to a more moderate but structured growth pattern.

The most intense price increase may have already passed, especially for investors who entered the market later in the cycle.