Despite Bitcoin's recent 15% gain this month, some industry experts remain unconvinced that the cryptocurrency has emerged from the bear market that began in October, given that it still lags 40% behind its record high. Some forecasters predict a potential decline to as low as $40,000, a 70% drop from its all-time high.
Bitcoin analyst James Check considers such a move unlikely, stating that it would be statistically extraordinary, albeit not impossible. Check references the Bitcoin Mean Reversion Index, which combines key valuation metrics such as the 200-week moving average and realized price.
When modeled at $40,000, Bitcoin's price falls within the 0.4th percentile of all daily closes, indicating a deviation below any meaningful threshold. Check notes that this would be equivalent to Bitcoin trading below $2 in 2011 on a relative basis, emphasizing that while no market event has zero probability, a drop to $40,000 would be a near-unprecedented outcome.