Since its launch roughly 12 years in the past, Bitcoin (BTC) has seen plenty of bull and bear cycles, every better than the final. What drives these cycles, nevertheless? Decred co-founder Jake Yocom-Piatt has claimed that the reply lies throughout the human mind. 

“Bitcoin’s bull and bear cycles are features of generic human psychology, consideration spans, and its deterministic and diminishing issuance,” Yocom-Piatt instructed Cointelegraph.

Over time, varied events have argued completely different instances for Bitcoin’s cycles, together with PlanB’s stock-to-flow mannequin, which tasks future Bitcoin costs primarily based on its programmed halving occasions each 4 years.

Bitcoin is in contrast to any asset earlier than it. Its programmed finite provide and ease of motion enable for borderless worth storage.

One would possibly marvel, although, whether or not Bitcoin’s nature as a programmed asset dictates its worth cycles on some stage, particularly since its mining reward cuts in half each 4 years, primarily placing fewer Bitcoin available on the market every time a block is mined. Its final 21 million provide cap may additionally issue into the equation.

“The speed of provide of Bitcoin is continually shrinking as a proportion of the whole circulation, with the addition of a considerable provide shock each halvening,” Yocom-Piatt defined.

“Bull runs happen when demand begins to outstrip provide, driving up the value, which will get the eye of myopic buyers. After a sure period of time, these myopic buyers’ consideration span for a bull market fades, and we revert to a bear market. With every bull market, the general consciousness of Bitcoin grows, sowing the seeds for the following bull run.”

Bitcoin lately flirted with its 2017 all-time excessive close to $20,000, receiving its justifiable share of mainstream media protection within the course of.