Bitcoin has fallen 50% from its October 2025 peak, but the decline tracks historical four-year cycles in timing and severity. The next market bottom isn't coming early—it's projected for late 2026 as institutional behavior shifts.
Timing Fits the Pattern
The seven-month pullback looks normal when you check the charts. Previous cycles saw deeper average drops of 65% by this stage, but the current price action mirrors 2018 and 2022 bear-market rallies. The data shows troughs typically hit about a year after each peak—January 2015 followed the November 2013 high. That puts the next low squarely in Q4 2026.
Funds Aren't Digging In
Strategy made its first Bitcoin sale in four years this spring. Spot ETFs joined the exit as May outflows spiked dramatically from February's levels. Neither group is parking capital long-term. They're moving in and out as allocations shift, which explains the accelerated institutional derisking beyond what price weakness alone would drive.
IPOs Siphon the Juice
SpaceX, OpenAI, and Anthropic are sucking up risk capital with mega-IPOs totaling over $240 billion. This liquidity drain will keep pressure on crypto through late 2026. For now, it's a clear headwind as investors chase the hottest new offerings.
Lockup expirations from those IPOs will eventually flood the market with cash. Newly liquid employees and investors tend to chase higher-beta assets like Bitcoin once restrictions lift. That potential tailwind won't hit until after the cycle bottom, but it's coming. The next move hinges on whether that capital flows back into crypto after the expected Q4 2026 low.
