That strange familiarity in the tape. The way Bitcoin starts moving before anyone agrees on why. The way confidence builds quietly underneath the headlines, long before the front pages catch up. When I first looked at this cycle’s structure, something didn’t add up — or rather, it added up too neatly. The rhythm felt familiar. Not random. Not new. Familiar.
Bitcoin is repeating the 2017 and 2021 pattern.
Not in price alone. In structure. In tempo. In psychology.
In 2017, Bitcoin spent months grinding upward after its 2016 halving. It didn’t explode immediately. It built a foundation. By early 2017, it had broken its previous all-time high near $1,150 — a level set in late 2013. That breakout mattered because it marked the first clean air above prior resistance in years. Once price clears a major historical ceiling, there’s no one left holding bags at that level. There’s no natural seller overhead. That creates space. And space changes behavior.
The same thing happened in 2020 heading into 2021. After the May 2020 halving, Bitcoin consolidated for months. It wasn’t dramatic. It was steady. Then in December 2020, it broke above $20,000 — the 2017 high. Again, clean air. Again, no trapped supply. That breakout wasn’t just technical. It was psychological. It signaled that the previous cycle’s pain had been fully absorbed.
Now look at the present cycle. After the 2024 halving, Bitcoin reclaimed and broke above its prior high around $69,000, first set in 2021. And just like before, the breakout didn’t immediately trigger a straight vertical move. It stalled. It consolidated. It made people doubt. That hesitation is part of the pattern.
Here’s what’s happening on the surface: price breaks out, pulls back, chops sideways, and frustrates both bulls and bears.
Underneath, something more important is happening: long-term holders are absorbing supply while weaker hands rotate out. You can see this in on-chain data. In both 2017 and 2021, the percentage of Bitcoin held by long-term wallets — coins unmoved for 155 days or more — steadily climbed during consolidation phases. That metric matters because it measures conviction. When coins go dormant, it suggests owners are not interested in short-term volatility.
Right now, long-term holder supply is again climbing after an initial distribution near the highs. That’s the same pattern we saw before the final acceleration phases in prior cycles. The surface looks uncertain. The foundation looks steady.
Understanding that helps explain why volatility compresses before expansion. When coins cluster in strong hands, there’s less supply available to meet new demand. It doesn’t take much incremental buying to move price sharply upward. That’s how parabolic phases begin — not because of hype, but because of imbalance.
In 2017, once Bitcoin cleared $3,000 — roughly triple its previous high — momentum fed on itself. Retail participation surged. Google search trends spiked. By December, price touched nearly $20,000, a 17x move from the breakout year’s start.
In 2021, the move was more muted but structurally similar. Bitcoin broke $20,000 in December 2020 and ran to $64,000 by April 2021. That’s a little over 3x in four months. After a mid-cycle reset, it pushed again to $69,000 in November.
Notice something. Each cycle’s multiplier compresses. Early cycles produced 50x or 100x gains. Later cycles produce 10x, then 3x. That’s what happens as an asset matures and liquidity deepens. It takes more capital to move the market. But the pattern — breakout, consolidation, acceleration — remains intact.
This time, there’s an additional layer. Spot Bitcoin ETFs. In early 2024, institutional access changed. Billions of dollars in inflows came through regulated vehicles. That matters because ETF flows create steady, mechanical demand. When investors buy shares, the fund must acquire Bitcoin. That’s not speculative leverage. That’s structural buying pressure.
Surface effect: price rallies on ETF inflows.
Underneath: circulating supply tightens further because ETF-held coins are effectively removed from liquid markets.
What that enables is slower, more sustained moves rather than purely retail-driven spikes. What risk it creates is concentration — large custodians holding significant supply introduces systemic dependencies that didn’t exist in 2017.
Meanwhile, derivatives markets tell a familiar story. Funding rates — the payments traders make to hold leveraged long or short positions — tend to flip positive during euphoric phases. In both 2017 and early 2021, funding became persistently elevated before major corrections. That was leverage overheating.
Currently, funding periodically spikes but resets quickly. That suggests speculation is present but not yet extreme. If this holds, it implies we’re not in the terminal phase. Parabolic blow-offs usually coincide with sustained leverage excess.
Skeptics will say this time is different. And they’re right in one sense. Macro conditions aren’t identical. Interest rates are higher than they were in 2020. Liquidity is tighter. Global risk appetite fluctuates with every central bank meeting.
But Bitcoin has never required identical macro backdrops to follow its internal cycle structure. The halving reduces new supply issuance by 50% roughly every four years. In 2016, daily issuance dropped from 3,600 BTC to 1,800. In 2020, from 1,800 to 900. In 2024, from 900 to 450. Each reduction seems small relative to total supply — 450 BTC per day is tiny against 19+ million already mined — but markets trade on marginal flows, not totals. If daily new supply shrinks while demand stays steady or grows, price must adjust upward to ration access.
That supply shock doesn’t hit instantly. It works quietly. Miners sell fewer coins. Exchanges see lower inflows. The texture of order books changes. Liquidity thins at the edges. Then when demand returns — often triggered by narrative or momentum — price moves faster than expected.
This layering explains why cycles feel slow until they feel sudden.
Another repeated pattern: disbelief. In 2017, analysts called $5,000 unsustainable. In 2021, $30,000 was labeled absurd. Today, even after breaking prior highs, large segments of the market remain cautious. Sentiment surveys are elevated but not euphoric. Retail participation, measured by app downloads and small transaction counts, hasn’t reached prior extremes. That gap between price strength and public excitement is telling.
That momentum creates another effect. Institutions accumulate while retail hesitates. In prior cycles, the final phase began only after mainstream participation surged — when price appreciation became dinner-table conversation.
Early signs suggest we’re not fully there yet.
Zooming out, what we’re seeing may not just be a repetition but a refinement. Each cycle becomes less explosive but more structurally integrated into the broader financial system. Bitcoin is changing how capital allocates to non-sovereign assets. It’s moving from outsider speculation toward portfolio allocation.
If this pattern continues, future cycles may compress further — smaller percentage gains, longer consolidation phases, deeper integration with global liquidity cycles. The raw volatility of 2017 may never return. But the core mechanism — supply contraction meeting episodic demand — remains intact.
And that’s the real pattern.
Not hype. Not headlines. A steady four-year heartbeat driven by programmed scarcity and human behavior layered on top of it.
We can argue about exact targets. We can debate macro headwinds. That’s healthy. What’s harder to ignore is the rhythm — breakout above prior highs, hesitation, absorption, expansion.
When markets repeat themselves, it’s rarely because history is lazy. It’s because incentives haven’t changed. Bitcoin’s supply schedule hasn’t changed. Human psychology hasn’t changed either.
If this cycle truly mirrors 2017 and 2021, the quiet consolidation we’re seeing now isn’t weakness.