Despite Bitcoin's recent 15% gain this month, some industry experts remain unconvinced that the largest cryptocurrency has escaped the bear market that began in October, given that it still remains 40% below its record high. Some forecasters predict a potential drop to as low as $40,000, a 70% decline from its all-time high, with analyst James Check deeming such a move statistically extraordinary, though not impossible. After surpassing $126,000 in October, Bitcoin plummeted over 50% to around $60,000 in February before stabilizing, and was trading near $78,000 on Friday. Check suggests that the bearish predictions warrant closer examination, pointing to the Bitcoin Mean Reversion Index, which averages key valuation metrics including the 200-week moving average and volume-weighted average price measures.
According to this index, a $40,000 price would rank as a 0.4th percentile event, meaning it would fall below any meaningful deviation across major anchors. Check notes that this would be equivalent to Bitcoin trading below $2 in 2011 on a relative basis, whereas the current price sits around the 31.5th percentile, historically weak but within normal correction ranges. Check concedes that while there's no zero probability in markets, a $40,000 price would be a near-unprecedented outcome.