Bitcoin’s post-halving cycle is unfolding differently than previous market expansions, raising questions about whether the traditional four-year pattern still applies.
Historically Bitcoin [BTC] demand accelerated after the halving and absorbed the tighter supply.
This time, however, apparent demand remained negative for much of 2026, even falling to almost -147,000 BTC in May. This weakness indicates that new purchases have struggled to keep pace with available supply.
Meanwhile, the MVRV peaked at 2.74 in 2025, well below previous cycle highs of 3.96, 4.72 and 5.88. The decline points to a maturing market with less speculative excesses. Still, Bitcoin continues to trade around $64,365, showing that demand has not completely disappeared.
Instead, the market appears to be caught between institutional support and slowing spot accumulation. Whether Bitcoin resumes its uptrend or continues consolidation may depend less on cycle timing and more on renewed demand growth.
Liquidity emerges as Bitcoin’s main limitation
While demand has weakened for much of 2026, liquidity conditions reveal a deeper challenge to the current cycle. While Bitcoin’s supply remains relatively limited, the flow of new capital has weakened.
In fact, Bitcoin ETFs have experienced continued outflows in 2026, indicating institutional fatigue amid weak liquidity.
Stablecoin offering has grown to $320 billion, but new issuance has slowed sharply, while global M2 liquidity has increased only modestly. This explains why Bitcoin is struggling to build on its post-halving gains despite tighter supply conditions.
Still, the market has remained more resilient than in previous cycles. Moreover, the relatively small decline of 45-50% from the highs of $126,000 suggests that institutional capital is absorbing some of the pressure, even as liquidity conditions limit expansion.
Yet demand is only one side of the equation shaping Bitcoin’s current cycle. Currency reserves have fallen to 2.7 million BTC as coins move into self-custody and long-term storage.
This reduces the amount of Bitcoin immediately available for sale, offsetting the softer buying activity. Meanwhile, bIn addition to the supply dynamics, the market itself is changing. ETF shares have grown to over 678,000 BTC, and cumulative inflows are approaching $54 billion.
As institutional ownership increases, Bitcoin appears to be increasingly influenced by capital allocation decisions, rather than just halving cycles. This shift could reduce volatility, although renewed demand remains essential for sustainable progress.
Final summary
- Bitcoin [BTC] shows signs of market maturity, but weaker demand and liquidity continue to limit expansion post-halving.
- Bitcoin remains supported by declining supply and institutional ownership, although new capital is still needed for sustainable progress.