Bitcoin traders are facing fresh warnings of a sharp price drop as analysts debate how deep the current correction could go. One analyst says Bitcoin could fall as much as 70% from its peak, with $38,000 acting as a possible bottom.
A crypto analyst known as “Sherlock” shared the forecast on social media platform X. The analysis compares Bitcoin’s past bear market drawdowns to estimate where the current cycle might end.
According to the data, Bitcoin fell about 93% in the 2011 cycle. Later cycles saw smaller drops, including 86% in 2015, 84% in 2018, and roughly 77% during the 2022 bear market.
Sherlock argues that this trend points to a smaller but still severe decline this time. A 70% drawdown from the latest all-time high would place Bitcoin near the $38,000 level.
Not all traders agree with the forecast. Some analysts say stronger institutional involvement could soften the fall, limiting losses to around 55% to 60% instead of 70%.
They argue that comparing past rallies from market bottoms to declines from peaks suggests a shallower correction. In their view, large investors may provide support during major sell-offs.
Sherlock responded that market reflexivity can work both ways. He warned that sharp declines can accelerate just as quickly as rallies and advised traders against trying to time an exact bottom.
Bitcoin has already dropped back to levels last seen in October 2024. While the price has recovered slightly from recent lows, it remains under pressure as traders watch for signs of a market bottom.
