Bitcoin has not escaped its volatile nature and could still crash as much as 50% in the right scenarios, warns BitMine chair Tom Lee.
“I’m sure there will be 50% drawdowns,” Lee said during an interview published on Thursday with crypto entrepreneur Anthony Pompliano.
There has been an increasing number of market participants in recent times who have argued that Bitcoin won’t be as volatile anymore, as spot Bitcoin ETFs and institutional interest bring greater stability to the market.
However, Lee argues that Bitcoin (BTC) still follows the stock market and often amplifies its movements.
“The stock market has more frequent 25% drawdowns,” he said. “The stock market has made a lot of progress over the last six years; we’ve had an unusually large amount of 25% drawdowns,” Lee added.
“So if the S&P is down 20, Bitcoin could be down 40,” he said.
Longer Cycle Developing in the Future for Bitcoin
Lee also argued that Bitcoin has broken from its typical four-year cycle, which would have pointed to a peak in October, suggesting instead that a “longer cycle” is now developing for Bitcoin.
Speaking on the Bankless podcast earlier this month, Lee reiterated his forecast for Bitcoin to reach $200,000 to $250,000 by year-end.
A 50% correction from that level would return BTC’s price to roughly $125,000, near its current all-time high.
If Bitcoin has already peaked, as some four-year-cycle believers suggest, a 50% decline from its current price of $109,981 would bring it down to about $54,990, a level not seen since September 2024.
Peter Brandt Recently Echoed a Similar Sentiment
He’s not the only analyst in recent times to make such bearish claims, with veteran trader Peter Brandt recently echoing a similar sentiment.
Brandt recently said that Bitcoin’s price chart mirrors a similar pattern to the soybean market in the 1970s before plummeting 50%.
Such steep Bitcoin declines have occurred before in a matter of months. In November 2021, Bitcoin hit a record high of $69,000 before plunging roughly 50% to around $35,000 in just over three months by late January 2022.
Other Bitcoin advocates are confident that the downside won’t be as drastic in the future.
Strategy chairman Michael Saylor said in June, “Winter is not coming back.”