Bernstein: Recent Bitcoin sell-off mainly stems from investors' concerns about the four-year cycle peak

According to The Block, Bitcoin (BTC) has fallen about 25% since reaching an all-time high of approximately $126,000. Bernstein analyst Gautam Chhugani stated in a report to clients on Monday that this decline reflects investors' anxiety over the historical four-year cycle pattern—this pattern has seen peaks in 2013, 2017, and 2021—many investors sold early during the market weakness, believing that 2025 would repeat, thus creating a self-fulfilling prophecy to some extent.

However, they believe that the current fundamentals are stronger, with data suggesting that this is more likely a "relatively shallow correction," forming a new local bottom rather than the 60% to 70% declines seen in historical cycles—thanks to the significant absorption of supply by long-term holders. Analysis indicates that over the past six months, investors holding Bitcoin for at least a year have sold about 340,000 BTC (approximately $38 billion), while around $34 billion in funds has flowed into spot ETFs and corporate treasuries, largely absorbing these sell-offs.

Looking ahead, analysts believe that the market "does not seem to be at a cyclical peak," but rather is part of a multi-year trend defined by institutional participation and moderate cyclical corrections. They are focused on whether Bitcoin can establish a bottom around $80,000—this level emerged after last year's U.S. presidential election—and believe that the current correction may provide an attractive entry opportunity for digital assets and related stocks.