The crypto market is entering a turbulence zone identified by the global liquidity cycle for 25 years. As Bitcoin faces a potential 20% loss in the coming months, silver is already up by 13%, positioning itself as the new safe-haven asset until 2026. Explore the imminent capital rotation dynamics.
First identified in 1999 through Fourier analysis, this 5.5-year cycle is based on the alternation between phases of global liquidity expansion and contraction. Each cycle follows an identifiable pattern: massive liquidity injection by central banks, speculative euphoria on risk assets, then credit tightening leading to a generalized correction for Bitcoin.
The model suggests we are approaching the peak of this cycle, with an expected summit in Q1 or Q2 2026. This timeline places the market in an “overheating” window where capital flows are gradually slowing down, increasing the probability of a brutal revaluation of overvalued assets. Historically, cryptocurrencies and technology stocks are the first to be hit during these reversal phases.
However, several analysts warn against too literal a reading of this model. The exact timing of peaks remains difficult to determine precisely, with error margins of several quarters. An experienced trader on X points out that “the cycle chronology is often shifted by several years on the chart, making it impossible to determine if the peak has already been reached or is yet to come”. This uncertainty requires prudent risk management rather than aggressive market timing.
Despite these limitations, the model maintains significant credibility among macro analysts, particularly because it incorporates global liquidity data rather than focusing solely on benchmark rates or inflation. This holistic approach better captures the real dynamics of cross-border capital flows.
The relative performance between Bitcoin and silver illustrates the ongoing repositioning in markets. Since early 2025, these two assets have evolved in opposite trajectories: Bitcoin, strongly correlated with global liquidity and accommodative monetary policy, faces selling pressure as liquidity contracts, according to CrossBorder Capital. Institutional investors who had massively invested during the 2023-2024 bull phase are now conducting profit-taking.
Conversely, silver benefits from growing structural demand linked to the energy transition, particularly in solar panels and electronic components, and its safe-haven status. This industrial demand creates a price floor that limits downward volatility, making it attractive in the current macroeconomic context. Projections anticipate silver outperformance between January and April 2026, before a possible “liquidity echo rally” that would allow Bitcoin to rebound in the second half of 2026, when monetary conditions ease.
The year 2026 is shaping up as a strategic repositioning window. Long-term holders (LTH) continue to accumulate at current support levels, betting on a post-correction rebound. Diversification remains key: Allocating part of the portfolio to tangible assets like silver reduces exposure to brutal corrections, while a targeted crypto allocation on Bitcoin and Ethereum sets the stage to capture the next liquidity wave in 2027. Bitcoin’s major technical support, located between $75,000 and $80,000, remains the critical zone to monitor to confirm the resilience of the upward trend.
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