Amidst the common volatility and uncertainty characteristic of this bull cycle, Bitcoin’s (BTC) price dropped to approximately $77,000 last week before rebounding over 10% to successfully regain the $85,000 level.
Despite this rebound, the significant market corrections seen recently have sparked serious concerns regarding the sustainability of the current bull market. Intriguingly, on-chain analytics company IntoTheBlock suggests that we may not have reached the market peak yet based on historical trends.
Bitcoin Halving Cycles Indicate Diminishing Returns, Yet Market Could Peak by 150%
In its latest weekly newsletter, analysts at IntoTheBlock have delved into historical data to assess the present state of the Bitcoin market. This revealing report shows that BTC is still significantly below its anticipated returns based on past cycles, indicating that the crypto bull run might still be in play.
According to IntoTheBlock, Bitcoin has consistently recorded lower returns after each halving, with each successive cycle yielding lesser peak gains than its predecessors. The halving is a pivotal blockchain event where the reward for Bitcoin miners is halved, controlling the issuance of new tokens to preserve scarcity.
Every four years, the halving serves as a significant marker in the market cycle. Following the first halving in November 2012, Bitcoin saw astronomical gains peaking between 6,000% and 8,000%, stabilizing afterward at about 1,600% to 4,000%.
The surge after the second halving was also strong, reaching nearly 2,000% before settling at 600%. After the third halving in May 2020, BTC recorded modest gains capped at 600%.
Clearly, the BTC market exhibits a trend of diminishing returns following successive halvings, indicating that the premier cryptocurrency’s growth potential decreases as prices increase. This trend is typical of a maturing market, with Bitcoin now standing as the eighth largest asset globally.
Currently, the Bitcoin cycle has only achieved a peak gain of 60% after the halving. While this fourth cycle is anticipated to continue the pattern of diminishing returns, IntoTheBlock analysts project maximum market gains in the range of 50%-150%, suggesting there is still potential for price growth at this time.
Will BTC Price Peak in H2 2025?
Further analysis from IntoTheBlock indicates that Bitcoin typically reaches its market peak 12-18 months after a halving. Following this trend, the leading cryptocurrency is expected to undergo significant appreciation between mid-2025 and late 2025.
However, it is important to recognize that current market conditions are unique, particularly given the rise in institutional interest and the recent tariff policies enacted by the US government. As of this writing, Bitcoin is trading at $84,391, reflecting a 1.64% decline over the past week.
Featured image from iStock, chart from Tradingview
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