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When macroeconomic conditions shift—be it through political turbulence or economic downturns—investors often shun riskier assets, including cryptocurrencies. This causes Bitcoin and altcoins to decline sharply, precipitating a chain reaction whereby leverage and debts force selling, contributing to broader market downturns.
Indefinite Cycles and Future Predictions
The interplay between the four-year cryptocurrency cycle and the liquidity cycle suggests an ongoing pattern. The persistent need for liquidity to sustain both the crypto and broader financial markets indicates that this cyclical behavior is likely to continue into the foreseeable future.