bitcoin is firmly in the deepest phase of the bear market and the pain may get worse, according to CK Zheng, founder of cryptocurrency investment firm ZX Squared Capital.
“Bitcoin price is now convincingly in deep bear market territory. We expect a further 30% price decline during 2026 as the Iran war began,” Zheng told CoinDesk in an email, citing the “four-year cycle” as one of the key catalysts.
The world’s largest cryptocurrency has already halved since hitting a record high of more than $126,000 in October last year, according to data from CoinDesk. At the time of writing, it changed hands at around $68,000.
The four-year cycle of bitcoin
Cryptocurrency investors often talk about the “four-year cycle,” a pattern in which prices rise, fall, and then recover, centered on the mining reward halving every four years.
The halving, last implemented in April 2024, is a scheduled event that halves the rate of bitcoin supply expansion every 4 years. As of today, 3,125 BTC are issued as a reward for every block mined on the Bitcoin network, compared to the original 50 BTC at launch after four halving events to date.
Historically, the price of bitcoin has tended to peak between 16 and 18 months after a halving, followed by a bear market that typically lasts about a year.
BTC peaking in October last year, about 18 months after the April 2024 halving, means the cycle is playing out again. Therefore, the bear market could deepen in the short term.
Zheng said the cycle is proving very difficult to break. According to him, the reason is simple: human psychology.
“The ‘four-year crypto cycle’ momentum is gaining strength and is extremely difficult to break due to the psychological behaviors of individual investors,” Zheng said.
Individual investors tend to behave in predictable ways: buying in times of hype and selling in times of panic. That behavior reinforces the four-year pattern of boom and bust that has defined crypto markets for more than a decade.
Because of this, Zheng said bitcoin is still traded more as a speculative asset than a safe haven like gold.
He added that institutional adoption of bitcoin remains very slow and limited in scope at this stage and warned that some companies that have bought bitcoin as a treasury asset could be forced to sell, leading to a deeper price sell-off.
“The total size of cryptocurrency ETFs and digital asset treasury companies is only about 10% of the entire cryptocurrency market. Some digital asset treasury companies may be forced to sell cryptocurrencies to meet certain debt service requirements during this bear market, which may create a vicious circle,” Zheng said.
For now, Zheng’s outlook is clear: the cryptocurrency bear market may have to advance further before the next cycle begins.
