NakamotoNotes provides data and education, not financial advice. Bitcoin is volatile; you can lose money. Do your own research.
The NakamotoNotes Bitcoin Barometer tracks where we are in the current market cycle — updated daily using eight on-chain indicators.
Bitcoin has a well-documented tendency to move in multi-year cycles. These cycles are not perfectly regular, and they do not guarantee any specific outcome — but they are consistent enough to have shaped how many long-term Bitcoin investors think about market timing and position sizing.
Understanding the cycle framework does not require predicting the future. It requires recognizing historical patterns and knowing which on-chain indicators tend to reflect where we are in those patterns.
The Halving and the Four-Year Cycle
Bitcoin's supply issuance is governed by code. Every 210,000 blocks — approximately every four years — the reward miners receive for processing transactions is cut in half. This event is called the halving.
Halvings have occurred in 2012, 2016, 2020, and 2024. Each halving reduces the rate of new Bitcoin supply entering the market. The historical pattern:
- Pre-halving (6-12 months before): Anticipation builds, price begins recovering from prior bear market lows, on-chain metrics quietly accumulate.
- Post-halving expansion (12-24 months after): Reduced supply issuance meets sustained or growing demand. Historically, this phase has been associated with the largest price appreciation of each cycle.
- Cycle peak and correction: On-chain metrics reach historically extreme levels. New buyer composition shifts (more retail, more leverage). Price eventually corrects sharply.
- Bear market and accumulation: Price finds a floor, long-term holders accumulate at low prices, on-chain metrics reset. The cycle prepares to repeat.
The 2024 halving occurred in April 2024. Based on historical patterns, the 12-24 month post-halving expansion phase would run through 2025-2026.
Important caveat: Each cycle differs. Macro environment, institutional participation, regulatory landscape, and market structure all affect how each cycle unfolds. The four-year pattern is a historical observation, not a guarantee.
What On-Chain Indicators Tell You About Cycle Position
Price alone tells you what has happened. On-chain indicators tell you something about the underlying market structure — who is holding Bitcoin, at what cost basis, and whether the aggregate state of the network suggests exhaustion or opportunity.
Early Cycle (Accumulation Phase)
In the early post-bear-market phase, several indicators tend to be in historically low ranges:
- MVRV Z-Score near zero or negative: Market cap is near or below the aggregate cost basis of all holders. Most people are at or below breakeven. This has historically been the phase where patient long-term accumulators build positions.
- NUPL in Fear or Hope: Net unrealized profit/loss is low — the network holds modest gains or small losses in aggregate.
- Mayer Multiple below 1.0: Price is below its 200-day moving average. Long-term trend is still depressed relative to recent price.
- Puell Multiple depressed: Miners are earning low revenue relative to their annual average — often because price is low.
Mid Cycle (Expansion Phase)
As the cycle develops, on-chain metrics begin to normalize and trend upward:
- MVRV Z-Score rises as more of the supply moves into profit.
- NUPL moves into Optimism territory (0.25-0.50).
- Mayer Multiple climbs above 1.0, then 1.5 as price outpaces its 200-day average.
- Google Search Trends begin rising as mainstream attention returns to Bitcoin.
This phase has historically been the most productive for long-term holders who positioned early — price appreciation is happening, but the on-chain picture has not yet reached historically extreme levels.
Late Cycle (Euphoria and Risk Zone)
In the late stages of each cycle, on-chain metrics tend toward historically extreme levels:
- MVRV Z-Score elevated: Market cap far exceeds the aggregate cost basis. Almost everyone is in significant profit — which historically has preceded large distributions as long-term holders sell.
- NUPL in Euphoria (above 0.75): Near-universal unrealized gains across the network.
- Mayer Multiple above 2.4: Price is dramatically extended above its 200-day average. This level has historically been rare and has preceded sharp corrections.
- Pi Cycle Top signal: A specific crossover of two moving averages that has historically occurred within days of cycle peaks.
- Extreme Greed on Fear and Greed Index, peak Google Search Trends: Mainstream media coverage, new entrants flooding in.
Where We Are Now
Current Bitcoin Barometer reading (May 22, 2026): 21/100 — CHILL zone. Bitcoin price: $77,526.
A Barometer score of 21 reflects the aggregate of all eight indicators sitting in the lower 21st percentile of historical readings. This is consistent with an early-to-mid cycle position — not the historically extreme on-chain readings that have preceded major corrections, and not the deeply depressed readings seen at bear market bottoms.
The post-2024 halving expansion phase historically runs through 2025-2026. The on-chain data, as of now, is not showing the characteristics of a cycle peak.
How to Use This Framework
The four-year cycle framework is most useful as a long-term orientation tool, not a short-term trading signal. A few principles that many long-term Bitcoin investors apply:
- Position size relative to cycle position: Some investors hold larger positions when on-chain metrics indicate early cycle (low MVRV, low NUPL, Mayer Multiple below 1.0) and reduce exposure when metrics signal late cycle (high MVRV, high NUPL, Mayer Multiple above 2.4).
- Accumulate through bear markets, not just bull markets: Dollar-cost averaging through the accumulation phase (when sentiment is worst) has historically resulted in better average entry prices than buying during expansion.
- Use on-chain data, not price, as the primary signal: Price can be manipulated or distorted by short-term factors. On-chain data reflects the behavior of actual holders and reflects where the aggregate network sits in its profit/loss cycle.
None of this eliminates uncertainty. Bitcoin cycles vary, and external factors — macro conditions, regulation, technological change — can alter how each cycle plays out. The value of on-chain indicators is not that they predict the future. It is that they provide an objective, data-grounded perspective on where we are historically — which is more useful than headlines, social media, or short-term price action.
Track the current cycle position with the NakamotoNotes Bitcoin Barometer — updated daily.
NakamotoNotes provides data and education, not financial advice. Bitcoin is volatile; you can lose money. Do your own research.
