Let's talk about an interesting phenomenon—the impact of liquidity cycles on Bitcoin performance.

Breaking down the entire cycle, it can be divided into four stages. The acceleration stage is the most exciting, during which Bitcoin's daily average increase can reach about 0.22%, with prices climbing every day. In the expansion stage, although profits are still being made, the growth momentum clearly diminishes, and returns gradually weaken.

Then it enters the contraction stage, which is the most uncomfortable period—returns are basically nonexistent or even start to turn negative. Finally, the recovery stage begins, and the market starts to show some vitality, but basically it’s just treading water with little fluctuation.

These four stages cycle repeatedly, and whether your returns can outperform the market largely depends on which stage you entered. Interestingly, even the same asset can exhibit completely different performance under different liquidity environments. This is a valuable reference for friends engaged in medium- to long-term holdings.