Summary
1. Bitcoin Enters the Final Phase of Its Four-Year Cycle — A Characteristic “Pre-Peak Correction” Is Underway
Bitcoin has completed the two typical corrections seen in its four-year market cycle, pushing to new all-time highs as it approaches its climax phase. The 14% and 18% pullbacks between August and October followed historical patterns, while a key feature of the current cycle is the shift in dominant buyers—from treasury-focused corporations in the previous cycle to ETF-driven demand this time.
2. Global Political Shifts and Waning Trust in Fiat Currencies Are Fueling the Rally
Amid widespread political turnover driven by dissatisfaction with inflation policies, major economies are leaning toward expansionary, populist fiscal strategies in 2025. Investment capital has been flowing out of cash and into equities, real estate, gold, and Bitcoin, creating a structure where multiple asset classes are hitting simultaneous all-time highs. Despite the Federal Reserve resuming rate cuts, Bitcoin’s delayed rise can be attributed to the buyer transition and its correction phase.
3. Adoption Surges — U.S. ETF Holders Reach “Critical Mass”
Roughly 30% of major U.S. institutional investors now hold spot Bitcoin ETFs, suggesting that adoption has reached a critical mass. Including retail investors, crypto ownership in the U.S. stands at 15–20%, and exceeds 40% among millennials, showing rapid penetration across demographics. In Japan, Finance Minister Katayama’s stance is seen as a potentially positive catalyst for progress in national crypto policy.
In the previous issue, I mentioned that Bitcoin (BTC) tends to undergo two corrections of around 20% two months before the peak of its four-year cycle, and I suggested that the August correction "may be a sign of a final push toward ¥35 million in October."
Indeed, it corrected 14% from its August peak through September, and then again reached a new all-time high in October, before undergoing a second correction of 18%. While it's unclear whether it will reach ¥35 million as I predicted, the climax is finally approaching.
The underlying driver of this rise is a flight from fiat currencies. To curb inflation caused by fiscal spending and monetary easing during the COVID-19 pandemic, governments around the world attempted to normalize policies. However, public discontent hurt by inflation fueled widespread defeats for ruling parties in major developed countries in 2024.
As a result, "populism" accompanied by tax cuts is spreading around the world in 2025. The rise in the value of BTC is exemplified by the emergence of the Takaichi Cabinet, which advocates an active fiscal policy, and its growing popularity.
