Another bubble? Bitcoin Highs Follow Chinese Debt Cycles: New Study

Bitcoin (BTC) may hit new all-time highs, but it could be another bubble, suggest new research.

The analytics guru Materials scientist has a theoryWhich might irritate Bitcoin proponents as it appears to show a strong correlation between Bitcoin price cycles and Chinese debt cycles.

Questioning the power of the Bitcoin halving

Accepted The BTC / USD pair hit its final all-time high in April 2021, with high expectations that another will arrive before the end of the year.

Another bubble?  Bitcoin Highs Follow Chinese Debt Cycles: New Study
Another bubble? Bitcoin Highs Follow Chinese Debt Cycles: New Study

Looking back at the history of Bitcoin, Material Scientist shows that The previous highs in the Bitcoin cycle coincided with the highs in the Chinese debt cycle.

The ebb and flow of the tides – as in April this year compared to today – also marks a cooling off in Bitcoin. According to the analyst, this could mean not only that Bitcoin behaves like any other asset, but that its supply contraction is irrelevant after each halving..

He channeled the ideas of investor Ray Dalio, known for his own research on China’s economic behavior.

“I believe that Dalio is absolutely right when he says that debt cycles create bubbles. And here it is clearly correlated “he said in comments on Twitter.

So what if the BTC halving narrative is a lie and it’s really just about Chinese debt cycles?

The halving calls for Bitcoin to appreciate in value against unlimited assets thanks to its mathematically designed supply collapses that occur every four years. These increases should be an order of magnitude higher than the last and are clearly visible in tools like the stock-to-flow family of Bitcoin pricing models.

Nevertheless, With China and its debt in the spotlight thanks to the Evergrande debacle and previously thanks to the coronavirus, the reactions to the idea of ​​the debt cycle have been positive.

One answer even highlighted that Bitcoin whales are selling stocks after each peak in China’s debt cycle, and April 2021 was no exception.

With a low going The chances of a recovery in BTC price action look even better.

Bitcoin Liquidity Index vs. Chinese Debt Cycle Data vs. BTC / USD Chart (excerpt). Source: Materials Scientists / Twitter

Bitcoin, the Trojan horse

As reported by Cointelegraph, Dalio himself recently made headlines with his stance on Bitcoin.

Regulators, he warned this month, could still “kill” him with unfavorable policies., something that even its better-known defenders flatly reject.

Among them is Saifedean Ammous, author of “The Bitcoin Standard,” who argues that As the hardest money ever created, Bitcoin will be an inevitable buy for governments, even if its non-corrupt properties will force them to give up their power over money..

In this week, Alex Gladstein, Chief Strategy Officer of the Human Rights Foundation, too discussed the concept of Bitcoin as the “Trojan Horse of Freedom” in relation to state monopolies.TO

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