Bitcoin’s short-lived rebound faded on Wednesday as volatility in the world’s largest cryptocurrency continued.
Bitcoin was trading at around $66,166 as of 10:21 a.m. ET on Wednesday, down about 4% on the day.
The digital coin has been on a downward trajectory since hitting an all-time high above $126,000 in October with the sales have intensified over the past month. Bitcoin fell below $70,000 on February 5 and slipped to hold just above $60,000, which is considered a key level.
Bitcoin then recovered from these lows and returned above $70,000, but struggled to climb higher, remaining in the $66,000 to $72,000 range.
On Thursday, bitcoin was about 47% below its all-time high.
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Bitcoin Price Over the Past Month
Several factors have weighed on crypto markets, including the volatility of tech stocks in the United States, with which crypto assets often move in tandem.
Meanwhile, the February 5 sell-off was triggered by a wave of liquidations – when traders are forced to close their positions if the price of Bitcoin reaches a certain point. This has a cascading effect, which can exacerbate sales. These liquidations have since slowed down.
Investors are also wondering whether there will be a change in US monetary policy following US President Donald Trump’s nomination of Kevin Warsh for president. Fed Chairman late last month.
Sales to issuers of Bitcoin exchange-traded funds, or ETFs, which are large holders of digital coins, have driven outflows from these ETFs. This added to the pressure on the digital coin. However, over the past three days, Bitcoin ETFs have seen net inflows.
The Bitcoin cycle is coming back into focusMarket participants are investigating whether the typical bitcoin cycle is intact. This refers to the historical pattern after an event known as a halving, which often leads to new all-time highs for the cryptocurrency and a subsequent crash before new highs.
Bitcoin halved — an event written in its code this happens every four years – reduces the rewards given to Bitcoin miners and effectively slows the supply of Bitcoin to the market. The supply squeeze usually precedes the rally to new record highs for Bitcoin. The most recent halving took place in April 2024.
There has been some debate as to whether the typical bitcoin the cycle is finished or the models break. But investors and analysts suggest the cycle is mostly intact.
“I expect 2026 to be a bearish period relative to the four-year cycle,” Steven McClurg, CEO of Canary Capital, told CNBC on Wednesday. “We’ve had several four-year cycles since Bitcoin launched and this one is no different than the others.”
McClurg added that he expects bitcoin to fall to $50,000 this summer before “things turn around in the fall.”
Markus Thielen of 10X Research told CNBC last week, bitcoin could fall to the $50,000 level.