The recent decrease in Bitcoin has once again led to the usual worrying that comes with every downturn in the crypto market. The crypto market has seen price drops, but the term crash is being used by the media, and there are predictions of an approaching apocalypse on social networks. 

The close to 30% fall could be perceived as a shocking event, however to an experienced observer it is just another scene in the long-run for Bitcoin, which was easy to predict.

The Numbers Behind the Decline

Bitcoin’s withdrawal from its record high once again points out the harsh price swings that the cryptocurrency is characterized by. After reaching an all-time high of about $126,000 at the beginning of October, bitcoin dropped to around $80,000, which is a pullback of roughly 36%. Even though it has made some recovery, the digital currency’s price is still over 26%, which is lower than its peak, as per Coinmetrics data.

However, this is not something very unusual historically speaking, it is actually very close to being standard. Bitcoin’s price has been moving in “cycles,” where each cycle lasts about four years, with the halving, or programmed reduction in mining rewards, being the most significant factor.  

The debate surrounding such cycles evolving with time is ongoing, but the extent of the price fluctuations remains the same. During this current cycle, there has been a 32.7% decline from March to August 2024. A further 31.7% fall in prices occurred from January to April 2025. These are not deviations from the norm, but they reflect the trend.

CoinDesk Data analyst Jacob Joseph said,

“Looking at previous cycles, volatility of this magnitude appears consistent with long-term trends”.

He mentioned that in 2017, bitcoin had the first 40% decline, then a second 40% fall, and finally a 29% drop. 

In 2021, Bitcoin experienced 31% and 26% declines followed by a massive 55% correction due to China’s restrictions on bitcoin mining and still went on to reach a record high that year.

What Triggered This Latest Shakeout?

This recent volatility is what crypto analysts referred to as the largest liquidation in the industry’s history. October 10 was the starting date of the event that saw over 1.6 million traders getting their accounts wiped out. 

To put it another way, $19.37 billion worth of leveraged positions vanished in just 24 hours. There was a ripple effect of forced liquidations that went through exchanges and trading desks and even more selling was triggered as a result of that.

Lucy Gazmararian, the founder of Token Bay Capital said,

″It was the biggest liquidation event in crypto’s history and that it took quite a few weeks to see the fallout from that and for the market to consolidate. It also coincided at a time when there’s a lot of concern that we are reaching the end of a bull market … so that has increased the levels of fear out there in the market”.

This very turbulence came at a time when investors had actually started to worry that the bullish run might be nearing exhaustion, which is a psychological trigger that always amplifies market reactions. Crypto winters have traditionally pushed bitcoin down 70% to 80% from its all-time high, which is a range that has not yet been observed in this cycle. However, the concern for such a drop is increasingly heavy on market sentiment. Gazmararian said,

“Really the timing of the drop, where we are in the cycle, that’s making investors cautious in case we do see that 80% drop”.

What’s Next?

Although the 30% decline in bitcoin looks very drastic, but over the past 10 years, similar declines have been occurring mostly in the context of the formation of major rallies rather than long-term collapses. The question of whether this cycle will repeat the exact same pattern or will it break away from the tradition is still open. 

The story of the market in record liquidations is processing the fallout, and the investors are asking themselves what was their place in the cycle, bitcoin is still that thing which it has always been, which is nothing less than unpredictable, resilient and forever rewriting the expectations.