The cryptocurrency market is currently showing signs of volatility, crashing incessantly for the last two weeks. Bitcoin has also been showing signs of decline, crashing below $87K at present. Moreover, the recent crypto market crash is instilling new fears, with investors worrying over whether the market blues have finally arrived. Is the cryptocurrency market entering its bear phase?
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Why Is Bitcoin Falling?
According to NDV’s Jason Huang, Bitcoin’s latest price plunge is due to its four-year issuance cycle, impacting its price in the long haul.
“There are several reasons for the current pullback. Bitcoin follows a four-year issuance cycle. In the 2008–2012 cycle, 10 million new BTC were produced; in the current cycle, only 600,000. The amount of new supply decreases with every cycle, reducing structural sell pressure.”
Huang later shared how major macro elements, including the Fed and trade tariffs, have taken a toll on BTC’s price in general.
“After ETF approval, Bitcoin’s price has become demand-driven rather than supply-driven. In today’s unstable global macro environment, Bitcoin is highly valuable, but the halving cycle still creates additional sell pressure. On October 11, Bitcoin fell sharply after Trump tweeted about the possibility of a second tariff war, leading to a major downturn and roughly $20 billion in liquidations due to excessive leverage. Without that tweet, I believe Bitcoin would likely be trading between $130,000 and $150,000 today.”
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What About The Bear Market Narrative?
Despite the recent market corrections, Huhag shared how he is still skeptical about bear market narratives, stating that the market has yet to experience that scenario.
“This current correction is also around 30%, so I remain optimistic. Over the long run, Bitcoin will continue to attract investors. After Trump’s tariff announcements, both gold and Bitcoin recovered faster than the Nasdaq because many investors treat them as monetary hedges and prefer to accumulate them at lower prices rather than at higher levels. From this perspective, I am optimistic going forward.”
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