Which Stage is Bitcoin in the Halving Cycle?
Bitcoin did not experience the explosive start that many had anticipated at the beginning of 2025. After breaking through the $100,000 barrier, the price significantly retraced, leading both investors and analysts to question: At which stage of the halving cycle is Bitcoin currently positioned?
In this article, we will penetrate the market noise and delve into a series of key on-chain indicators and macroeconomic signals to assess whether the Bitcoin bull market remains sustainable, or if it is on the verge of a deeper correction.
Healthy Correction or End of the Bull Market?
An ideal entry point is the MVRV-Z indicator. This long-established valuation metric assesses the asset’s status by comparing the cryptocurrency’s market value to its realized value (Market Value to Realized Value). When this value retreated from a peak of 3.36 to around 1.43, it coincided with Bitcoin’s price dropping from its near $100,000 high to a low of $75,000. Intuitively, this 30% price correction is indeed quite severe.
Recently, the MVRV Z-Score has rebounded from a low of 1.43 in 2025.
Historically, the current level of the MVRV-Z indicator often marks local bottoms rather than tops. In past cycles such as 2017 and 2021, the market experienced similar corrections, after which the BTC price resumed its upward trend. In short, although this downturn has shaken investor confidence, it is fundamentally consistent with historical corrections within a bull market cycle.
Monitoring Smart Money Movements
Another key indicator is the Value Days Destroyed (VDD) multiple. This metric weights the time Bitcoin is held before trading, measuring its on-chain transfer velocity. When this multiple surges, it typically indicates that experienced holders are locking in profits; sustained low levels may suggest the market is in an accumulation phase.
Currently, this indicator is deeply entrenched in the “green zone,” with levels resembling those at the end of a bear market or the initial phase of recovery. Given the sharp reversal of BTC prices from above $100,000, we may be witnessing the conclusion of a profit-taking wave, while some long-term accumulation behaviors have become increasingly evident, indicating that participants are positioning themselves for future price increases.
The current VDD multiple indicates that long-term holders are in an accumulation phase.
One of the most insightful on-chain indicators is the “Bitcoin Cycle Capital Flow Chart,” which segments realized capital by coin age, isolating different groups such as newcomers (holding time < 1 month) and mid-term holders (1-2 years) to observe capital migration paths. The red band (newcomers) surged sharply near the historical high of $106,000, suggesting that a significant amount of FOMO-driven panic buying occurred at market peaks. Subsequently, the activity of this group has cooled significantly, reverting to levels consistent with the early to mid-stage bull market.
Conversely, the group holding tokens for 1-2 years (typically insightful accumulators) has resumed buying behavior. This inverse relationship reveals the core logic of market operations: when long-term holders accumulate at the bottom, new investors often experience panic selling or choose to exit. This alternating capital flow pattern aligns closely with the “accumulation—distribution” pattern observed throughout the complete bull market cycle of 2020-2021, reflecting typical characteristics of historical cycles.
The Bitcoin Cycle Capital Flow Chart shows that BTC is flowing back to more experienced holders.
What Stage Are We Currently In?
From a macro perspective, we can categorize the Bitcoin market cycle into three key stages:
- Bear Market Stage: Deep Correction (70-90%)
- Recovery Stage: Reclaiming Historical Highs
- Bull Market Growth Stage: Parabolic Rise after Breaking Previous Highs
The bear markets of 2015 and 2018 lasted approximately 13-14 months each. Our most recent bear market cycle also lasted 14 months. Historically, the market recovery phase typically requires 23 to 26 months, and we are currently within this typical recovery time window.
Using historical cycle trends to forecast potential bull market peaks.
However, the performance of this bull market phase is somewhat atypical. Bitcoin did not experience an immediate surge after breaking historical highs, instead showing a retracement. This may suggest that the market is constructing a higher low before entering a steeper upward trajectory in the exponential growth phase. Assuming that the bull market can persist, based on the average durations of 9 and 11 months in previous cycles, we anticipate that the potential peak of this cycle may occur around September 2025.
Macroeconomic Risks
Despite encouraging on-chain data, significant macroeconomic headwinds remain. An analysis of the correlation chart between the S&P 500 and Bitcoin indicates that Bitcoin continues to maintain a high correlation with the U.S. stock market. With increasing concerns over a potential global recession, the ongoing weakness in traditional markets may impact Bitcoin’s ability to rebound in the short term.
The correlation between Bitcoin and U.S. stocks.
Conclusion
As observed in our analysis, key on-chain indicators such as the MVRV Z value, Value Days Destroyed, and Bitcoin Cycle Capital Flow indicate that the market is demonstrating a healthy development pattern consistent with cyclical laws, and showing signs of sustained accumulation by long-term holders. However, there remain significant macroeconomic uncertainties in the market, which are critical risks to monitor closely.
This cycle is slower and more volatile than previous ones but has not broken the historical structural pattern. Bitcoin appears to be gearing up for another upward movement and could reach new peaks in the third or early fourth quarter if the traditional market does not deteriorate further.
This article is co-published by: PANews