Bitcoin Still Faces Further Downside Risk, Deep Bear Market Could See Prices "Cut in Half" Again

On February 14, according to Business Insider, a strategist from Ned Davis Research stated in a report to clients this month that despite Bitcoin experiencing massive sell-offs over the past few months, it still faces further downside risk.

Ned Davis Research Chief Tactical Strategist Pat Tschosik and analyst Philippe Mouls pointed out that based on an analysis of past Bitcoin downturn cycles, if the current bear market evolves into a full-blown "crypto winter," the decline from peak to trough could reach 70%-75%, meaning Bitcoin could drop as low as $31,000.

Bitcoin has already fallen 44% from its peak in October last year. If it drops to the $31,000 level, it would mean a further 55% decline from current levels.

Tschosik and Mouls added that data shows that since 2011, the average decline during Bitcoin bear markets has been 84%, lasting an average of 225 days. Since Bitcoin peaked in early October last year, only 129 days have passed so far.

However, the two analysts also pointed out that a "winter" is not necessarily inevitable. Compared to the past, Bitcoin currently has more institutional buyers, which could bring greater stability to prices. "Historical data shows that the declines during winter/major bear markets tend to slow slightly over time. We believe this trend will continue," they said when discussing price forecasts.