July 10, 2026 — According to Gate market data, Bitcoin (BTC) is priced at $64,034. Compared to the cycle peak of nearly $125,000 in October 2025, this represents a cumulative drawdown of about 54%.
A 54% decline would typically mark the beginning of a prolonged bear market in any previous Bitcoin cycle. However, Wall Street research firm Bernstein disagrees. Led by analyst Gautam Chhugani, the team noted in a recent report that this cycle’s maximum drawdown of about 54% is far less severe than the 75% to 90% plunges seen at the end of past bear markets. Bernstein describes this correction as the "mildest" Bitcoin bear market in history and maintains a year-end 2026 price target of $150,000.
The gap between 54% and 90% isn’t just a numerical difference—it signals a profound shift in the underlying structure of the crypto market.
How Deep Is the "Pain Benchmark" of Historical Cycles?
Looking back at previous Bitcoin bear markets, a clear pattern emerges: the bursting of the 2013 bubble, the collapse from the 2018 peak, and the sharp decline after the FTX crisis in 2022 all saw maximum drawdowns locked in the brutal 75% to 85% range. Specifically, the 2018 bear market saw a peak drawdown of about 84%, while the 2022 bear market was around 78%. Across three cycles triggered by major industry events—2014–2015, 2018–2019, and 2022–2023—maximum drawdowns ranged from 76.7% to 83.6%.
Bernstein points out that a 75% to 90% drop is the true hallmark of a bear market’s end—these declines wiped out the 2013 bubble, the 2018 peak, and even post-2020 rallies. Based on the historical 75% drawdown, Bitcoin would fall from its $125,000 peak to about $31,000.
In this cycle, the drawdown is about 54%, with a low of roughly $58,115 as of June 25. While this drop is still a heavy blow for investors who bought at the highs, it looks more like a mid-cycle correction rather than a definitive signal of a bull-to-bear transition.
How Institutionalization Is Changing the Downward Slope
The most direct explanation for the narrower drawdown lies in structural changes among market participants.
In previous bear markets, retail investors dominated. When panic struck, retail tended to sell in concentrated, irrational waves, causing steep price drops. This time, institutional capital is playing a much deeper role. Bitwise Senior Investment Strategist Juan Leon observes that the current downturn is "the most structurally mild bear market" in Bitcoin’s history, with cycle bottoms rising and marginal holders shifting from retail speculators to professional asset allocators.
Institutionalization dampens declines in two ways. First, spot Bitcoin ETFs have brought in massive long-term holdings, with turnover rates far lower than retail, significantly reducing selling pressure. Second, institutions operate with different logic—whereas past bear markets saw investors asking "Can crypto survive?", now institutional investors are asking "When should I buy, and how much?" This shift in questioning is fundamentally reshaping the market’s downward trajectory.
ETF Flows and Divergence in Market Sentiment
Spot Bitcoin ETFs are another key to understanding why this bear market’s decline is milder.
Bernstein reports that in 2026, combined net inflows from corporate holders and spot Bitcoin ETFs total about $10 billion, a sharp drop from $60 billion in 2025. This year, spot Bitcoin ETFs have seen net outflows of roughly $5.5 billion, with total assets under management at $74 billion.
At first glance, ETF outflows seem like a bearish signal. But Bernstein offers a different perspective: with $74 billion in assets, a $5.5 billion outflow represents less than 7.5%. Coupled with Bitcoin’s near-halving in price, pessimism is amplified. The Chhugani team notes that while ETF flows fluctuate, there has been no forced, large-scale capitulation by institutional allocators. Major exchanges have seen a decrease in open interest, but not the cascading liquidations witnessed in 2022. This suggests the market is undergoing deleveraging, not an exodus from the asset class.
How Corporate Holdings Are Becoming the Market’s "Stable Anchor"
Against the backdrop of ETF outflows, corporate Bitcoin holders—led by Strategy (formerly MicroStrategy)—have become one of the few sources of positive inflows.
Citing company disclosures, Bernstein notes that Strategy accumulated about 175,000 Bitcoins in 2026, investing roughly $14 billion and raising its total holdings to 847,363 BTC. The report further breaks down Strategy’s financials: total debt amounts to just 13% of its Bitcoin collateral value, with the next $1 billion principal repayment due no later than Q3 2028; $15 billion in preferred stock is perpetual long-term capital, with no maturity pressure. This structure makes large-scale, forced Bitcoin selling by Strategy highly unlikely.
This "buy-only, no-sell" corporate holding strategy provides ongoing buying support during market downturns, objectively narrowing the downside price range.
Hashrate Migration: US Miners Exit and Global Reorganization
Another notable supply-side change comes from structural adjustments in the Bitcoin mining industry.
Bernstein’s report highlights that leading US-listed mining companies are rapidly shifting focus to AI data centers and may even exit Bitcoin mining entirely. The hashrate they release is expected to be absorbed by overseas miners in Southeast Asia, Central Asia, and Latin America.
The data tells the story: since the start of the year, average Bitcoin network hashrate has declined by about 11%. Over the past two quarters, US miners’ share of network hashrate dropped by more than 0.4 percentage points, while emerging market miners’ share increased by about 1 percentage point.
Hashrate migration doesn’t directly determine price, but it reflects a structural supply-side reshuffling in the Bitcoin network. The exit of US miners reduces their selling pressure—previously, there were concerns that miners would be forced to sell large amounts of Bitcoin due to worsening profitability. Meanwhile, new entrants from emerging markets maintain network security and decentralization with lower cost structures.
Multiple Hurdles Remain Before the Downturn Ends
A narrower drawdown doesn’t mean the cycle has reversed. While Bernstein maintains an optimistic price target, it also offers clear warnings.
From a timing perspective, the current decline from the cycle peak has lasted three quarters, while historical Bitcoin bear markets typically last 12 to 15 months. Bitwise similarly notes that past bear markets usually lasted 12 to 13 months, and this correction is only about eight months in, so further volatility or downside cannot be ruled out.
As for bottom confirmation signals, the market remains divided. Galaxy Research expects the cycle low to fall between $40,000 and $46,000 before Q4 2026, noting that only 4 out of 13 historical bottom indicators have been triggered. On July 1, Citi lowered its 12-month target from $112,000 to $82,000 and reduced its assumption for net spot Bitcoin ETF inflows over the next year from $10 billion to zero.
The macro environment is another variable not to be ignored. Global liquidity is flowing heavily into the AI sector, diverting funds from Bitcoin and other risk assets. Regulatory developments, interest rate paths, and institutional capital flows will remain key factors in determining whether the market can exit the downturn.
Summary
The gap between 54% and 90% is not just a numerical coincidence—it’s a structural reflection of Bitcoin’s shift from a retail-driven speculative era to an institutional allocation era. Long-term ETF holdings, ongoing corporate treasury purchases, and miner supply-side restructuring together underpin the milder slope of this bear market’s decline.
But "mild" doesn’t mean "over." The duration of the correction hasn’t reached historical norms, bottom signals aren’t fully triggered, and macro liquidity remains uncertain—all suggesting the market may still face a prolonged bottoming phase. Bernstein characterizes the current trend as a "mid-cycle adjustment mode," not a "cycle endpoint," implying that confirming a true exit from the downturn will require more data-driven evidence, not just a narrower drawdown.
Frequently Asked Questions (FAQ)
Q: What is the maximum drawdown in this Bitcoin bear market?
A: According to Bernstein’s research, Bitcoin has fallen about 54% from its cycle peak of nearly $125,000 in October 2025. As of July 10, 2026, Gate market data shows Bitcoin priced at $64,034.
Q: What is the average drawdown in historical Bitcoin bear markets?
A: Historical data shows that maximum drawdowns in past Bitcoin bear markets typically range from 75% to 90%. The 2018 bear market saw about 84%, the 2022 bear market about 78%, and the 2014–2015 and 2018–2019 bear markets ranged from 76.7% to 83.6%.
Q: What are the main reasons for the narrower drawdown in this bear market?
A: Key reasons include increased institutional participation, long-term holdings from spot Bitcoin ETFs, ongoing purchases by corporate Bitcoin holders (such as Strategy), and a shift in market participant structure from retail dominance to institutional allocation. Together, these factors have reduced selling pressure and volatility.
Q: Has Bitcoin exited the downturn?
A: The market remains divided. Bernstein maintains a year-end 2026 target of $150,000 and sees the 54% drawdown as a mid-cycle adjustment. Other firms, like Galaxy Research, expect the bottom to fall between $40,000 and $46,000. The correction’s duration hasn’t reached historical averages, and bottom signals aren’t fully confirmed.
Q: Does ETF outflow mean institutions are leaving?
A: Not necessarily. In 2026, spot Bitcoin ETF net outflows totaled about $5.5 billion, but that’s less than 7.5% of the $74 billion in assets under management. Bernstein notes that these outflows haven’t triggered large-scale capitulation among institutional allocators; the market is undergoing deleveraging, not fleeing the asset class.
