Max drawdowns by cycle:
- Cycle 1 (2013-15): -86.9%
- Cycle 2 (2017-18): -84.2%
- Cycle 3 (2021-22): -76.7%
- Cycle 4 (ongoing): -47.2% so far
Quick extrapolations (math, not a prediction):
- Linear trend C1 to C3 then: C4 = -72.4%
- Exponential decay fit: C4 = -72.8%
- Geometric ratio: C4 ≈ -72.0%
That’s what the past implies. But structure changed, spot ETFs, deeper liquidity/derivatives, and a looser backdrop than 2018-22 usually soften bear depths.
Probability bands:
- Base case: -60% to -65% final max drawdown
- Bearish tail: ~ -70% on a liquidity/regulatory shock
- Benign floor: ~ −50-55% if inflows keep absorbing supply
Where we are now: my 0-100 risk gauge prints 22 at ~$67k. Historically, the 20-29 slice shows up ~13.34% of BTC’s life, common enough that it’s not a once-in-a-cycle flush, but clearly on the cool side of the tape. In drawdown math terms above, that places today in the “accumulate rather than distribute” if you size by conditions instead of guessing bottoms.
We’re at -47% off the peak already, so either one more leg down or most of the damage is done. Use ranges, not targets. Add when it’s cool, trim when it’s hot. Not financial advice.
Posted by hduynam99
6 Comments
Great analysis. I have buys set for 63, 59, 55, 51 and 48k. We’ll see what happens.
My personal opinion, since we didn’t see euphoria at all with the highs of 2025 we won’t see such a sharp retracement compared to 2018, 2022, etc. Also, the 200 week right now is just a tad under 60k, which we are already very close to, and alts are back down to prices we saw in 2023. Could we tank further from here, sure, but I think we are very near the bottom already.
I think what’s really going to mess people up is they sold in Q4 2025 expecting a massive retracement that would finally bottom out late 2026. However, we end up bottoming here or sometime over the next couple months and then have another major leg up, which leaves them behind at the station. Given the end of QT, new fed chair and the 2028 election coming up I think there is a strong case for this.
Either way, I plan on accumulating sats while we are at bargain basement prices.
My buy is $35Knin normal market conditions. I could see it go down further if the entire market recorrects by 20 to 30%.
When btc passed 100k people so badly wanted to believe the 4 year cycle was broken.
It’s not.
It didn’t run up as much this time. It stayed around $100k for a while, this is by far the worst performing cycle. The only reason to stay invested is for the bigger picture, returns have been underwhelming
Or. Severe recession. Huge swath of population now struggling to put food on table and pay rent realizes we’ve been in the biggest irrational asset bubble in history over the last 6+ yrs, speculative assets with little or no utility (like BTC) go to near zero and never come back. A decade or two from now a new financial system built on something like blockchain but controlled by states will emerge and we’ll all look back at this beginning thing and remember the “BTC fever” of the 2020’s. But at least you’ll be able to say you participated.