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A Sharp Decline That Fits Bitcoin’s History

Bitcoin has tumbled roughly 30% from its record high — a move that might alarm newer investors but is entirely consistent with the cryptocurrency’s long-documented boom-and-bust rhythm. In fact, declines of this magnitude have appeared multiple times across every major cycle since bitcoin’s inception, often paving the way for a recovery to fresh all-time highs.

Data gathered by CoinDesk Data and broader market research shows that deep pullbacks are not only common but structurally embedded into bitcoin’s four-year halving cycle, the backbone of its long-term price behavior.

Recent Price Action Shows Familiar Volatility

Bitcoin briefly fell to around $80,000 in late October, rebounded, and then dipped again, hitting a roughly 36% drawdown from its all-time high of about $126,000 established earlier in the month. As of Thursday, the price had climbed back above $93,000 according to Coinmetrics, putting it around 26% below the peak.

This type of turbulence is nothing new.
In the current cycle alone, bitcoin endured a 32.7% correction between March and August 2024 and a 31.7% decline from January to April 2025.

Market analysts note that this behavior aligns closely with patterns seen in previous cycles.

How Bitcoin Cycles Typically Unfold

Bitcoin’s four-year cycle centers around the halving — a programmed reduction in mining rewards that slows supply growth. Historically, price surges and deep corrections occur before and after this event.

During the 2017 cycle:

• Bitcoin saw two declines of around 40% in the same year
• A 29% drop hit in November 2017
• Weeks later, bitcoin reached a new record high in December

During the 2021 cycle:

• Prices fell 31.2% in January
• Another 26% drop followed in February
• China’s mining ban triggered a massive 55% correction between April and June
• Bitcoin then recovered and set a new ATH in November

Analysts point out that most mid-cycle corrections historically occur within a broader bullish structure and often hold above long-term technical levels like the 50-week moving average.

Why the Market Dropped So Suddenly

The latest downturn began on October 10, when more than 1.6 million traders were liquidated in a single day — erasing an estimated $19.37 billion in leveraged positions. This was the largest liquidation event in the history of the crypto market.

That shock forced traders out of overleveraged positions, triggering a cascading effect across derivatives platforms, spot markets, and automated trading systems.

According to analysts, the aftershocks of that event are still settling.

Lucy Gazmararian, founder of Token Bay Capital, explained that such an enormous liquidation “takes weeks before the market stabilizes,” especially when it happens during a stage of the cycle where investors are already questioning whether the bull market is nearing its end.

Market Psychology and Fears of a Crypto Winter

Bitcoin bear markets — often referred to as “crypto winters” — have historically pushed the asset 70% to 80% below its peak. For example, during the 2018 cycle bitcoin fell more than 80%, and during the 2022 correction it briefly slid over 75%.

This time, the drawdown hasn’t come close to that level.
However, the fear that a deeper decline could occur is creating anxiety among traders.

The timing of the recent pullback — late in the cycle and following months of strong gains — has intensified concern that an extended downturn could be approaching, even though the data so far mirrors standard mid-cycle behavior rather than the onset of a full-scale crypto winter.

Where Bitcoin Goes From Here

Historical patterns show that corrections of 30% to 40% are often followed by strong recoveries and new highs, especially when they occur during a cycle supported by halving dynamics and sustained institutional inflows. Analysts caution, however, that while history offers guidance, each cycle develops under different global economic, regulatory, and liquidity conditions.

For now, bitcoin’s recent volatility remains in line with its long-term rhythm — a reminder that sudden drops and rapid rebounds are not the exception in crypto but the norm.