K33: Bitcoin's 40% drop resembles past bear markets, but this time it's different; an 80% crash is not expected.

A report by Vetle Lunde, Head of Research at K33, points out that Bitcoin has fallen approximately 40% from its October high, with a weekly drop of 11% last week. This price behavior is similar to the bear markets of 2018 and 2022, raising concerns about a repeat of the four-year cycle. Lunde believes this time is different, and does not expect the 80% peak-to-trough drop seen in past cycles. Reasons include increased institutional adoption, inflows of funds into regulated products, and a loose interest rate environment, as well as the lack of forced deleveraging events similar to GBTC, Luna, and FTX. On February 2nd, spot trading volume exceeded $8 billion (90th percentile), and the derivatives market recorded approximately $1.8 billion in long position liquidations. Extremely negative funding rates indicate a bottoming signal, but it remains uncertain. The key support level is $74,000; a break below this level could accelerate the decline to $69,000 or the 200-week moving average around $58,000. (The Block)