Bitcoin's Milder Bear Market a 'Comforting' Sign of Maturity, Bernstein Says

Bitcoin's ongoing correction, which has seen its price fall approximately 54% from its cycle peak, is being viewed by analysts at Bernstein as a “rather comforting” development and a sign of a maturing market.

In a note to clients, analysts led by Gautam Chhugani highlighted that while the cryptocurrency has retested lows near $60,000, the current bear market is notably less severe than previous downturns, which typically saw corrections of 75% to 90%.

Shifting Investor and Miner Behavior

The report details a changing landscape for Bitcoin investment and production. While Bitcoin ETFs have experienced significant outflows of $5.5 billion this year from a $74 billion asset base, buying from corporate treasuries has helped absorb some of the selling pressure.

Bernstein specifically pointed to the stability of a major corporate holder, referred to as Strategy, noting it has 17 months of cash reserves and that its debt represents just 13% of its Bitcoin collateral value. “It looks unlikely any major Bitcoin forced supply could come from Strategy and it continues to be a net buyer in the market,” the analysts wrote. Meanwhile, U.S.-listed Bitcoin miners have become net sellers as they pivot to AI data center operations, leading to a drop in the U.S. share of the global hash rate by over 40 basis points in the last two quarters.

Ad

Price Outlook and Regulatory Context

Bernstein acknowledged that its year-end price target of $150,000 for Bitcoin “appears ambitious in context of the market correction” but maintained a long-term bullish outlook. The analysts believe the broader cycle will eventually turn positive.

On the regulatory front, the firm noted continued progress with rulemaking for stablecoins under the GENIUS Act and the introduction of crypto perpetual futures on U.S. platforms. The overall analysis suggests a market that is evolving, leading Bernstein to conclude that while “any crypto correction is painful, this one has been rather comforting.”