Benson Sun: This round of Bitcoin may show a slow bull trend, gradually hitting new highs.

BlockBeats news, September 26: Crypto KOL and former FTX community partner Benson Sun posted that he expects Bitcoin's current market cycle may show a slow bull trend of gradually making new highs, rather than forming an obvious top after a short-term rapid rise like in 2013 and 2017. Before the real cycle top arrives, the market may see multiple local topping signals appear one after another.

He believes that after 2021, BTC's main buying has gradually shifted from retail to institutions such as public companies, spot ETFs, and corporate treasuries. Because institutions mainly buy spot, and some funds also use Delta Neutral strategies for arbitrage, traditional indicators such as funding rates and the MVRV Z-Score may not necessarily rise to extreme levels again at the cycle top. The recent cycle top is more likely to manifest as institutions running out of follow-through capital, rather than retail sentiment becoming comprehensively overheated.

The Institutional Liquidity Index (ILI) mainly references overall dollar liquidity, Strategy's mNAV, and Bitcoin ETF net flows, and is used to judge whether institutional capital is following along in sync when BTC makes new highs. When BTC hits a rolling 30-day high but the ILI does not rise in sync, it forms a yellow divergence; when BTC breaks above its all-time high while the ILI diverges and is below 50, it forms a red divergence.

Benson Sun said he will use the number of yellow divergences as a reference for judging the progress of the cycle: each time one appears, appropriately reduce altcoin positions and leverage; as the market enters its later stage, gradually increase the BTC allocation and ultimately hold only spot. If a red divergence appears, then stop participating further.