Bitcoin Corrections Shrink to Record Lows
The four-year cycle of Bitcoin's price movements is showing signs of compression, according to data compiled by Galaxy Research. The magnitude of corrections has decreased from about 85% in early cycles to nearly 53% in the current cycle.
Historically, Bitcoin experienced significant declines of around 84% and 77% in previous cycles. However, the latest correction is significantly less severe, with a decrease of only 53%. Proportionally, this correction is approximately 38% less deep than that of the first major cycle.
The change in magnitude can be attributed to several factors, including spot Bitcoin ETFs, companies accumulating BTC in their treasuries, and an expanding investor base. These developments have added buyers to the market, contributing to the reduced severity of corrections.
Notably, rallies between lows and highs are also shrinking, with a decrease of over 72% in the multiple between the first and fourth episodes. This trend suggests that Bitcoin's price movements are becoming less extreme.