Price Plunge and Grayscale’s Assessment
Bitcoin has fallen more than 50% since its October 2025 peak of $125,000, now trading below $60,000. In a new report, Grayscale Research characterizes the selloff as a cyclical correction within a secular bull market, not a structural reversal. Historical patterns show that Bitcoin typically undergoes deep pullbacks 18–24 months after halving events, and the current decline aligns with those precedents.
Two Variables Determining the Bottom
Grayscale highlights two key factors that will determine whether a final bottom is set: first, the Federal Reserve’s interest rate trajectory—if inflation pressures force further tightening, risk assets will continue to suffer; second, the legislative progress of the CLARITY Act in the U.S. Senate. The bill, if passed, would clarify the classification and regulatory framework for digital assets, potentially unlocking institutional inflows. The bill is currently in a critical hearing phase.
Long-Term Appeal at Current Levels
Despite short-term volatility, Grayscale argues that current prices already price in most negative scenarios, making it an ideal accumulation zone for long-term holders. Historical corrections of similar magnitude (e.g., 2018, March 2020) were followed by new all-time highs within 12–18 months. Institutional long positions are seen as a key source of market resilience.