Grayscale: Macro View Suggests Bitcoin Price May Already Be at Bottom

Grayscale's research team has weighed in on the Bitcoin bear market, offering two competing views on when the price may bottom out.

The first perspective is based on the four-year cycle theory, which suggests that Bitcoin halving events drive price movements. According to this framework, Bitcoin's price tends to bottom about a year after the cyclical peak and roughly 2.5 years after the halving event, with cumulative drawdowns averaging around 80%.

The second perspective is based on the idea that Bitcoin has matured into a full-fledged asset class, meaning its price now moves in sync with the broader macro backdrop. Grayscale points to prior downturns as evidence, noting that Bitcoin bear markets have corresponded with slowing economic growth and/or rising real interest rates.

The research team at Grayscale sides firmly with the macro view, suggesting that if the Federal Reserve forgoes rate hikes and economic growth holds up well, Bitcoin's price may already have bottomed. The key distinction is that the cycle view predicts lower lows ahead, while the macro lens suggests the worst could be over.