Bitcoin cycle meets liquidity: a new price driver

Ran Neuner argues that the traditional bitcoin cycle narrative misreads what really drives prices, pointing instead to global liquidity as the dominant force.

Halving as a comforting but misleading framework

In a recent 17 minute episode of Crypto Insider, Neuner challenges the idea that Bitcoin moves in a reliable four year rhythm. He stresses that the pattern many traders rely on was built on just three complete halving cycles, which is far too little data to serve as a solid statistical foundation.

He opens with a stark warning: if investors are selling now because they believe the latest four year cycle has ended, they risk becoming what institutions call the “dumb money”. According to Neuner, the familiar script of a post halving peak followed by an 80 percent drawdown lulled market participants into a false sense of security.

Moreover, he notes that the halving schedule appeared to give analysts “three full cycles of data” and a neat story that made the market feel predictable. However, he insists that anyone with basic statistical training knows that three observations are not a meaningful sample, especially for an asset as volatile as Bitcoin.

Instead of accepting the halving pattern at face value, Neuner says he pulled together macroeconomic, liquidity, equity and political data into “one chart, one model.” In that work, the halving “definitely played a part, but it was a small factor.” The major price surges, he says, lined up with something larger that repeated across all three past cycles but has not appeared clearly in this one.

Liquidity as the real driver of Bitcoin booms and busts

That larger force, in Neuner’s telling, is global quantitative easing and the broader expansion of money supply. He revisits the first halving in late 2012, when Bitcoin rose from $10 to $1,250 while the Federal Reserve was injecting “$85 billion worth of liquidity into the market every month,” ultimately adding more than $1 trillion to its balance sheet.

When the Fed began slowing and then ending QE, Bitcoin slid from about $1,000 to roughly $150. That devastating decline “lines up perfectly with the halving cycle,” Neuner concedes, but he argues it was actually driven by liquidity withdrawal rather than an arbitrary supply schedule.

He then tracks a similar pattern in 2017, when Bitcoin climbed from around $1,000 to nearly $20,000. During that period, the European Central Bank ran one of its largest bond buying programs, the Bank of Japan was purchasing bonds and ETFs “at an unprecedented rate,” and China unleashed what he calls “the biggest credit impulse in history.”

The Covid era rally from roughly $4,000 to $69,000 followed the same liquidity script. This time, Neuner highlights what he describes as “the biggest global liquidity injection in the history of finance,” with the Federal Reserve expanding its balance sheet by more than $5 trillion while other major central banks moved in the same direction.

That said, Neuner believes these episodes show that the halving acted more like a supporting detail than a primary catalyst. In his framework, Bitcoin bull markets erupted when liquidity surged and ended when liquidity reversed, regardless of the precise timing of block reward cuts.

PMI, institutional flows and the new market clock

To anchor his view in a measurable indicator, Neuner turns to the global Purchasing Managers’ Index (PMI). He calls it “the key metric that tracks” whether the economy is expanding or contracting and links it directly to risk appetite and credit creation across markets.

Historically, he says, when the PMI bottoms and then breaks back above the 50 line, “that’s when the liquidity starts returning” and Bitcoin finds a durable floor. Moreover, readings above 55 have aligned with the start of what he terms the “real bull runs,” while PMI levels around 60 have coincided with his so called “altcoin super cycle.”

Neuner notes that in both the 2017 and 2020 uptrends, PMI pushed through these thresholds just as central banks were expanding their balance sheets and crypto markets were going vertical. In his view, these simultaneous moves in PMI and liquidity formed the true clock that traders should have been watching.

This cycle, however, looks different. “This time the Fed cycle and the PMI didn’t line up with a halving,” he argues. For roughly the past two years, the Federal Reserve has been draining liquidity through quantitative tightening, while PMI readings have been flat to slightly lower rather than surging.

That, Neuner contends, explains why “it should have been a bull market, but it wasn’t,” despite the narrative boost from another halving event. Bitcoin, he notes, now trades below where it started the year, underscoring how reliance on the four year template led many investors astray.

The halving clock versus the liquidity clock

According to Neuner, the halving calendar and the liquidity cycle moved together for three previous market phases, which helped reinforce the industry’s belief in a neat halving driven bitcoin cycle. However, the current environment has decoupled those forces, leaving traders anchored to a schedule that no longer reflects underlying macro conditions.

Moreover, he suggests that this decoupling has created a dangerous gap between perception and reality. Retail investors continue to track rainbow charts and predictable post halving scenarios, while professional desks and algorithms focus on measures such as PMI, central bank balance sheets and broader credit growth.

A warning to retail sellers and a bet on liquidity

Neuner’s conclusion is stark: “We have never entered a bear market in a period where liquidity is expanding. Never, not once in history.” With the Federal Reserve now signaling an end to tightening, lower rates ahead and a likely eventual return to QE, he expects liquidity conditions to turn decisively more supportive.

He predicts that PMI will “start to fly” once policy fully pivots, and that institutional strategies will move firmly into “risk on” mode. To illustrate the gap between institutional and retail thinking, he invokes Larry Fink, asking rhetorically whether the BlackRock chief has a rainbow chart on his wall or cares about any rigid four year calendar.

In Neuner’s narrative, institutions are watching liquidity, the Fed balance sheet and PMI, not colorful historical overlays. However, he argues that many small investors are preparing to sell because they fear a repeat of past post halving crashes rather than watching those macro signals.

Framing the current pullback as a trap, he tells viewers that selling now out of fear of a “four year cycle ghost” could mean “selling your coins literally at the bottom” to larger players. In his view, the four year calendar never truly governed Bitcoin in the first place, and the real liquidity driven cycle may still be in its early stages.

Cycle myths, liquidity realities and what comes next

Neuner ultimately labels the four year halving script “a lie,” not in the sense that past peaks and troughs did not occur, but because the explanation was misplaced. The powerful force behind those moves, he contends, was global easing and tightening, not a predictable mechanical supply cut.

Moreover, he stresses that the lesson for traders is to pay attention to macro data rather than repeat simple narratives. As central banks pivot away from the most aggressive tightening phase, he believes the conditions that previously drove Bitcoin from $10 to $69,000 could re emerge in some form.

That said, Neuner closes with a contrarian message: “This cycle isn’t over. In fact, if anything, this cycle hasn’t even begun.” For investors weighing whether to sell into weakness, his analysis argues that the key variable to watch is not an arbitrary date, but the evolving trajectory of global liquidity and PMI.