21Shares: Bitcoin Remains in Four-Year Cycle Despite Recent Decline

21Shares Affirms Bitcoin's Cycle Amid Market Changes

Cryptocurrency investment firm 21Shares has confirmed that Bitcoin's historical four-year cycle remains intact, despite recent fluctuations in the market. The firm anticipates a significant shift in this cycle by 2026, although current market conditions show notable differences from past cycles.

In a recent report, 21Shares noted that Bitcoin has experienced a less severe decline than in previous cycles, with its price dipping below $60,000 for the second time this month. As of Wednesday, Bitcoin is trading at $59,781, which is 52% lower than its peak of $126,080 but still above its on-chain cost basis of $54,000, suggesting that a complete market capitulation has not occurred.

The firm initially projected that Bitcoin would exit its established cycle by 2026 but has since acknowledged that the price movements still reflect familiar patterns. They highlighted that while institutional ownership of ETFs is increasing, the current drawdown of around 50% is significantly milder compared to the 80%+ declines seen in earlier cycles.

Despite expectations for a surge in crypto ETF assets under management (AUM) to $400 billion this year, the reality has fallen short. Instead of inflows, nearly $3 billion has been withdrawn from crypto ETFs in the last quarter, contributing to declines in Bitcoin and Ethereum prices. Overall, the total assets in crypto ETFs have decreased by almost $5 billion since the start of the year.

Other optimistic forecasts, including a projected $1 trillion stablecoin market capitalization and a $300 billion total value locked in DeFi, have also faced hurdles due to regulatory uncertainties and ongoing market challenges. Nonetheless, 21Shares remains positive about the prediction market trading volumes, expecting them to exceed $100 billion this year, with platforms like Polymarket and Kalshi leading the way.