Author: Bai Ding

Bitcoin soared to a historic high of $69,000 in 2021, fell to a low of $15,400 in 2022, surged to $110,000 by the end of 2024, and is now fluctuating between $75,000 and $85,000. For ordinary investors, one question lingers: "Where exactly is the bottom price of Bitcoin in this cycle? Has it already hit the bottom, or is there still room for decline?" We will analyze this issue from the perspectives of historical patterns, on-chain data, macroeconomic background, and mining costs, guiding you to explore potential bottom-buying opportunities. This article aims to provide a trustworthy reference for ordinary readers in an easy-to-understand manner, combined with authoritative analysis.

To understand the bottom price of Bitcoin, we first need to review the patterns of its price cycles. Since Bitcoin's inception in 2009, it has experienced multiple bull and bear markets, often closely related to "halving" events. Halving refers to the Bitcoin network reducing miners' rewards by half every four years, thereby slowing the supply of new Bitcoins.

Historically, halving usually triggers a bull market, but within 1-2 years after halving, the market often undergoes a deep correction, forming a cycle bottom. Previous cycles provide us with clues: after the 2012 halving, the price peaked in 2013 and bottomed around $200 in 2015; after the 2016 halving, the bull market pushed the price to $20,000 in 2017, which then fell to $3,200 in 2018; after the 2020 halving, the price reached a high of $69,000 in 2021 and then dropped to $15,400 in 2022. These bottoms typically occur 18-24 months after halving, with prices dropping 70%-85% from previous highs. The fourth halving occurred in April 2024, and according to this pattern, the key window for forming a bottom may be from mid-2025 to early 2026.

However, historical patterns are just the starting point; the actual bottom price needs to be analyzed in conjunction with various factors.

First, mining costs are the most critical variable that cannot be ignored. The mining process of Bitcoin requires substantial electricity and computational power, and the operating costs for miners (i.e., the minimum cost to keep mining equipment running) often provide an "invisible support" for Bitcoin prices. When Bitcoin prices fall close to or below mining costs, some miners may choose to shut down, reducing selling pressure and stabilizing prices.

From the above chart, we can see that historically, during good market conditions, Bitcoin prices often exceed mining costs significantly, while in bear markets, they tend to align with mining costs, and the growth of mining costs slows down, leading to a significant drop when transitioning to a bear market. Considering the current expected average mining cost of Bitcoin is roughly similar, a drop could lead to a price range between $70,000 and $80,000. This is an estimate of Bitcoin's bottom from the perspective of mining costs.

On-chain data further provides us with clues for finding the bottom. On-chain data records transactions, holdings, and mining activities on the Bitcoin blockchain, reflecting the true movements of market participants. Among them, the selling behavior of "long-term holders" (investors holding Bitcoin for over a year) is an important indicator of bottom signals. At the bottom of the bear market in 2022, the selling ratio of long-term holders significantly decreased, indicating their increased confidence in low prices.

At the same time, "net inflow to exchanges" also decreased significantly, showing that investors were no longer in a hurry to sell. Additionally, the "realized price" (reflecting the average buying cost of all holders) is a key indicator. In 2022, when Bitcoin prices fell to $16,500, it was close to the realized price of about $18,000 at that time, indicating that market selling pressure had largely been released.

The macroeconomic environment also has a significant impact on the bottom price of Bitcoin. The bear market in 2022 occurred against the backdrop of global central banks raising interest rates and a strengthening dollar. The Federal Reserve raised interest rates consecutively to curb inflation, putting pressure on risk assets, including Bitcoin. However, starting in 2023, the Federal Reserve gradually slowed the pace of interest rate hikes, and began cutting rates in the second half of 2024, providing liquidity support for the crypto market.

At the same time, global economic uncertainties (such as geopolitical conflicts and supply chain crises) have driven some funds into decentralized assets like Bitcoin, seeking safe havens. Under the current macro backdrop, the bottom price of Bitcoin may be more ambiguous compared to previous cycles, with a range of $20,000 to $25,000 being more likely. We all know that 2027 is a critical time node for international (mainly referring to China and the U.S.) patterns and relations, and as 2027 approaches, the macro situation becomes increasingly difficult to predict, which is the biggest variable for the bottom price of Bitcoin in this cycle.

The participation of institutional investors is another significant feature of this cycle. Unlike in the past, since 2020, institutions like MicroStrategy and Grayscale have become important forces in the market by purchasing Bitcoin ETFs or holding Bitcoin directly. In 2024, the U.S. approved several spot Bitcoin ETFs, attracting billions of dollars in inflows. These institutional funds typically have strong resistance to declines and can provide support during market downturns.

For example, in 2022, the stability of institutional holdings helped Bitcoin avoid a more significant drop. The continuous inflow of institutional funds suggests that the decline in this cycle's bottom may be milder compared to historical cycles, with a lower probability of falling below $20,000. It is worth noting that institutional investors often use mining costs as a reference for buying, further reinforcing the possibility of $70,000-$80,000 as a support level.

It is important to emphasize a concept: the high volatility of cryptocurrencies means that the bottom is not an "absolute low point," but rather a relatively stable price range. External factors, such as tightening regulatory policies, hacking attacks, or sudden macroeconomic events, can lead to prices temporarily falling below expectations. For instance, the collapse of the Terra ecosystem and the bankruptcy of FTX in 2022 triggered market panic, causing Bitcoin prices to drop more than expected.

Moreover, mining costs are not an absolute bottom line; if global energy prices rise significantly, some high-cost mining operations may be forced to shut down, exacerbating selling pressure in the short term. Ordinary investors should adopt a phased buying strategy when bottom-fishing, avoiding investing all funds at once to cope with potential volatility.

In summary, we can make a reasonable judgment about the bottom price of Bitcoin in this cycle. Based on historical patterns, on-chain data, macroeconomic background, institutional fund participation, mining costs, and technical indicators, the bottom of this cycle is likely to be between $65,000 and $80,000, with the time window possibly concentrated from mid-2025 to early 2026. This range takes into account the historical declines and the support role of mining costs, as well as the uniqueness of institutional funds and the macro environment, making it highly valuable as a reference. Investment always comes with uncertainty, and ordinary investors should remain rational, avoiding blind chasing of highs or panic selling.