Moves from previous cycles not only show how the current price swings are all part of bitcoin’s normal operating pattern but also how they may often precede a rally, according to figures compiled by CoinDesk Data for CNBC.
Bitcoin, the world’s largest cryptocurrency, dropped to a low of around $80,000 late last month before staging a rally and falling again this week. When bitcoin dropped to under $81,000, that represented an approximately 36% fall from its all-time high of around $126,000 hit earlier in October. As of Thursday, bitcoin was trading at over $93,000, according to Coinmetrics, a roughly 26% decline from its record high.
These price swings may seem large but they are normal in relation to bitcoin’s history.
Bitcoin’s price movement is often referred to in “cycles.” Generally, the bitcoin cycle refers to a four-year pattern of price movement that revolves around a key event known as the halving, a change to mining rewards that is written in bitcoin’s code. While there are signs that the typical timing and patterns of the cycles could be changing, the range of price movements appears to be consistent.
In the current cycle, bitcoin has already weathered a 32.7% pullback from March to August 2024 and a 31.7% decline between January and April 2025, according to CoinDesk Data.
“Looking at previous cycles, volatility of this magnitude appears consistent with long-term trends,” Jacob Joseph, senior research analyst at CoinDesk Data, told CNBC.
During the 2017 cycle, there were drawdowns of around 40% twice that year and then a 29% decline in November before bitcoin reached a new record high in December.
Looking back at the 2021 cycle, bitcoin recorded declines of 31.2% in January that year and 26% in February. There was a more than 55% correction between April and June 2021 as China banned bitcoin mining. The asset then rallied to a new high in November that year.
“While deeper mid-cycle corrections have certainly occurred, nearly all of them — aside from the mining-ban-drop in 2021 — took place within a broader bullish structure, often holding above key technical levels such as its 50-week moving average,” Joseph said.
What has driven market moves?
Beginning Oct. 10, more than 1.6 million traders suffered a combined $19.37 billion erasure of leveraged positions over a 24-hour period. Many traders were forced out of their positions and the impact of that cascaded across the industry.
That effect is still being felt, according to Lucy Gazmararian, founder of Token Bay Capital.
“[It was the] biggest liquidation event in crypto’s history and that takes quite a few weeks to see the fallout from that and for the market to consolidate,” Gazmararian told “Access Middle East” on Thursday.
“It also coincided at a time when there’s a lot of concern that we are reaching the end of a bull market … so that has increased the levels of fear out there in the market.”
In the past, when the bull market ends and there is a period of depressed prices, often dubbed a “crypto winter,” bitcoin has tended to sit 70% to 80% below its all-time high. This has not yet happened. But concern about this coming to pass is weighing on investors’ minds.
“Really the timing of the drop, where we are in the cycle, that’s making investors cautious in case we do see that 80% drop,” Gazmararian said.
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