Former Bloomberg Intelligence strategist Jamie Coutts says the drivers behind Bitcoin’s (BTC) current cycle are shifting, with long-term forces like artificial intelligence set to play a decisive role.
In a new post on X, the Real Vision chief crypto analyst says exchange-traded funds (ETFs) and Bitcoin treasury companies (TCs) have shaped the current cycle.
While inflows from Bitcoin treasury companies have slowed, Coutts says it is not indicative of a market cycle top.
“ETFs and BTC TCs have driven this cycle, but the structural bid from TCs is slowing as mNAVs compress. The weight of this market now sits more with the ETF flows. Meanwhile, spot sovereign accumulation — harder to track — is the wild card. After a dismal early September, ETFs flipped bullish again — right on cue with tops and bottoms since launch.
In my September Real Vision report, I expected a 25% correction after buying from these two cohorts inflected at the new all-time high. That move is totally normal within Bitcoin’s volatility signature.
Liquidity’s still supportive, but momentum refuses to deliver fireworks, frustrating everyone chasing a parabola. Looking ahead, global liquidity is lagging debt growth — cycle peak? Not likely.”
He also believes that a central bank easing cycle will trigger rallies for Bitcoin and altcoins.
“Bitcoin’s so-called ‘boring’ climb actually echoes the slow crawl in global liquidity this cycle. Ironically, a dull cycle could mean a shallow bear drawdown, but also a longer grind down. Central banks, if (when) they reverse their [balance sheet] tightening, will set off another leg higher—with the move likely accentuated in alts. With that will likely come the conditions for a peak and potentially the setup for a deeper fall than what I would expect, worst case ~50%. We aren’t anywhere near that yet.”
Despite the potential for another brutal bear market in the future, Coutts believes that long-term trends will serve as tailwinds for Bitcoin.
“Still, two secular trends are bulletproof: blockchain adoption and monetary debasement. And for these reasons, it’s best to zoom out and remember Bitcoin is fast becoming global collateral, it’s an AI-beneficiary technology, the driver of energy grid stabilization/modernization and the anchor asset for global portfolios.”
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