Bitcoin CK Cheng, founder of cryptocurrency investment company ZX Squared Capital, said that we are currently in the deepest stage of the bear market and the pain may intensify.
“Bitcoin’s price is indeed in deep bear market territory right now. With the outbreak of the Iran war, we expect prices to drop a further 30% in 2026,” Zheng told CoinDesk in an email, citing the “four-year cycle” as one of the key catalysts.
The world’s largest cryptocurrency has nearly halved since hitting an all-time high of over $126,000 last October, according to CoinDesk. As of this writing, it’s changing hands for about $68,000.
Bitcoin four-year cycle
Cryptocurrency investors often talk about the “four-year cycle” — a pattern of price spikes, crashes, and then recoveries centered around the four-year mining reward halving.
The most recent halving was implemented in April 2024, a programmed event that halved Bitcoin’s supply expansion rate every 4 years. As of today, each block mined on the Bitcoin network releases 3.125 BTC as a reward, down from the initial 50 BTC when it was released after the four halving events to date.
Historically, Bitcoin’s price tends to peak approximately 16-18 months after a halving, followed by a bear market that typically lasts approximately a year.
Bitcoin peaked in October last year, approximately 18 months before the April 2024 halving, meaning this cycle is happening again. Therefore, the bear market may deepen in the short term.
That cycle has proven difficult to break, Zheng said. The reason, he believes, is simple: human psychology.
“The ‘crypto four-year cycle’ is gaining momentum and is extremely difficult to break due to the psychological behavior of individual investors,” Zheng said.
Individual investors tend to behave in predictable ways—buying when there is hype and selling when there is panic. This behavior reinforces a four-year boom-and-bust pattern that has defined cryptocurrency markets for more than a decade.
Because of this, Zheng said Bitcoin still trades more like a speculative asset than a safe haven like gold.
He added that institutional adoption of Bitcoin is still very slow and limited at this stage, and warned that some companies that bought Bitcoin as a treasury asset may be forced to sell, causing the price to fall further.
“The total size of crypto ETFs and digital asset library companies only accounts for about 10% of the entire crypto market. During a bear market, some digital asset library companies may be forced to sell cryptocurrencies to meet certain debt repayment requirements, which may form a vicious cycle.” Zheng said.
For now, Zheng’s outlook is clear: The crypto bear market may have further to run before the next cycle begins.
