jakiro
Author: Matt Crosby, Chief Analyst of Bitcoin Magazine Pro; Compiler: Shaw Bitcoin Vision
While many are still focused on how high Bitcoin can go in the current bull run (although given current price action, perhaps the gains are unsustainable), it is also important to be prepared for what comes next.Here, we will explore some data and mathematical models to help us estimate where the lows of Bitcoin’s next bear market may occur. This is not a prediction, but a framework based on past cycles, on-chain valuation indicators, and even Bitcoin’s fundamental valuation.
Cycle main chart
One of the most consistently accurate models for identifying Bitcoin’s cyclical bottoms is what we callBitcoin Cycle Master Chart, which aggregates many on-chain metrics to create bands around price with specific valuation levels.
Figure 1: The cycle low line on the main Bitcoin cycle chart aligns exactly with the bear market cycle low.
Looking at historical data, this green “cycle low” line almost perfectly marks Bitcoin’s macro bottom.From $160 in 2015 to $3,200 in 2018 to $15,500 in late 2022.As of now, the range sits around $43,000 and is rising daily, providing a useful benchmark for estimating how much Bitcoin may fall over the next full cycle.
Retracement decreases
Additionally, we can look at the raw MVRV ratio, which measures the ratio between Bitcoin’s market price and its realized price (the average cost basis of all Bitcoins).Historically,During deep bear markets, Bitcoin’s price tends to fall to 0.75x its realized price, meaning the market price is approximately 25% lower than the network’s total cost base.
Figure 2: Historically, bear market lows occur when the MVRV ratio falls to 0.75.
This repeatability provides us with a strong benchmark, combined with the trend of tapering declines, to estimate potential downside risk.Although Bitcoin’s early cycle declines were as deep as 88%, this number has been steadily compressed, reaching 80% in 2018 and 75% in 2022.If this trend continues, it is expected that the next bear market correction may fall by approximately 70% from the cycle high..
Figure 3: The trend of gradually decreasing retracements in bear market cycles suggests that the next pullback from the cycle high will not exceed 70%.
Before predicting the next low, we need to make reasonable assumptions about the likely peak of this bull market.Based on historical MVRV multiples and realized price growth trends,Bitcoin has tended to peak recently at about 2.5 times its realized price.If this relationship holds and realized prices continue to trend upward, this suggests that Bitcoin prices could peak at around $180,000 per coin in late 2025.
Figure 4: Applying MVRV multiples and realized price forecasts, we can see a cycle top near $180,000, followed by a 2027 bear market cycle bottom near $55,000 to $60,000.
If this is the case and Bitcoin follows its historical pattern,Entering a one-year bear market in 2027, with a 70% correction from the current price, the low of the next major cycle will be approximately between $55,000 and $60,000, which is also consistent with the consolidation range of Bitcoin fluctuations last year., thus forming a certain resonance at the technical level.
production cost
One of the most reliable long-term valuation indicators for Bitcoin is itsProduction cost, which is the estimated cost of electricity required to mine one Bitcoin.Historically, this indicator has closely correlated with the lowest points of Bitcoin’s bear markets.After each halving, the cost of production doubles, which over time creates a rising structural support beneath the price.
Figure 5: The estimated electricity cost to produce 1 Bitcoin is approximately $70,000, which constitutes a strong lower bound for price fluctuations.
When Bitcoin trades below its cost of production, it’s a sign of stress for miners and often an opportunity to build wealth.Since the April 2024 halving, the new cost basis has risen sharply, and every time Bitcoin prices have been close to or slightly below this level since then, it has marked a local bottom and subsequent sharp rebound.The value is currently around $70,000, but fluctuates daily.
Conclusion
Every Bitcoin cycle is accompanied by a wave of enthusiasm, with people declaring that “this time is different.”But the data proves otherwise.While institutional adoption and broader financial integration have certainly changed Bitcoin’s structure, they have not eliminated its cyclical nature.
The data shows thatThe next bear market is likely to be milder, reflecting more mature markets and more pronounced liquidity drivers.A price pullback into the $55,000 to $70,000 range does not signal a collapse, but rather marks the continuation of Bitcoin’s historic expansion and reset cycle.
