Bitcoin Surges 20% After Year‑Long Decline—Could the Halving Cycle Be Nearing?

Bitcoin reached an all‑time high of $126,210 in October 2025, only to slide more than 50% and touch roughly $58,000 two months ago. In a surprising turn, the cryptocurrency has climbed over 20% in the past week, its most pronounced rebound during this prolonged downturn. The move raises the question: is this the first leg of a new rally, or merely a fleeting bounce within a bear market?

**Bullish Rationale**

One argument for a bullish turn hinges on the easing of leverage. Analysts note that the high levels of borrowed exposure seen last summer helped push Bitcoin higher, but also left the price susceptible to deleveraging. With leverage now appearing more normalized, the downward pressure could ease.

A second factor is the Treasury’s recent bond‑buyback announcements, which some market watchers interpret as a sign that the dollar and U.S. Treasuries are losing their status as safe havens. This shift could make alternative assets such as gold and Bitcoin more attractive.

**Bearish Perspective**

Bitcoin’s price history is closely tied to its four‑year halving cycle, in which mining rewards are cut in half every four years. Historically, each cycle has produced a boom‑bust pattern, with drawdowns ranging from 75% to over 90% before a significant rally.

A single strong week does not erase a year‑long decline, and Bitcoin has a track record of false‑start rallies. If the asset follows its past four‑year pattern, the current uptick could signal the start of a move toward the projected halving in April 2028, with a peak anticipated in early 2029.

**Economic Calendar Context**

The Jackson Hole Economic Symposium opens today (Aug. 27–29). Fed Chair Kevin Warsh will deliver his first Jackson Hole keynote tomorrow, Aug. 28, at 10:00 a.m. ET, as the Fed is not yet in its pre‑FOMC blackout period.

In the equity market, the S&P 500 closed Tuesday at 7,677.28, about 1.8% below the August 13 record high of 7,816.70. Momentum has cooled from an over‑bought push, and the VIX sits near 15.8. The index is up roughly 13% year‑to‑date, indicating a relatively mild wobble.

**September’s Seasonality**

September has long been the most difficult month for stocks, with an average return of roughly –0.7% since 1950 and only a 44% chance of finishing higher. When layered with the four‑year cycle, the pattern sharpens: the midterm year (the year of the election) is the weakest, averaging about 4.5% and positive in only half the cases, while the pre‑election year that follows is the strongest, averaging roughly 16%.

For portfolio managers, the midterm cycle period is often seen as the most reliable “buy‑the‑fear” window. As investors brace for the election, a cautious approach may help mitigate downside risk.

In short, Bitcoin’s recent surge, coupled with macro‑economic signals and the looming halving, offers a compelling, though uncertain, case for a potential new rally. Market participants will be watching the next few weeks closely to see whether the trend holds or reverses.