Why Crypto Crashing Could Continue: The Bitcoin Four-Year Cycle Accelerates

As crypto crashing becomes an increasingly predictable market phenomenon, Bitcoin finds itself at a critical juncture. The world’s largest digital asset has declined sharply from its peak, raising concerns that worse may be ahead. CK Zheng, founder of investment firm ZX Squared Capital, believes the downturn could deepen significantly in the coming months, with additional losses potentially reaching 30% by 2026.

From Peak to Trough: Bitcoin’s Current Market Position

Bitcoin has already experienced a substantial pullback from its record highs. The cryptocurrency peaked above $126,000 last October, but has since retreated considerably. As of late March 2026, Bitcoin trades around $70,910, representing a decline of approximately 44% from its zenith. This sharp reversal has left many investors questioning whether the selling pressure will continue.

Zheng points to the timing of this correction as particularly notable. “Bitcoin’s price is now firmly in deep bear market territory,” he stated, adding that the pain may extend further into 2026. The current price action, combined with broader market dynamics, suggests that crypto crashing pressures remain significant. In fact, Bitcoin has posted modest gains recently, rising 4.59% over the past 24 hours, yet this recovery fails to reverse the overall downtrend that has dominated the year so far.

The Unstoppable Four-Year Cycle Pattern

What makes the current decline particularly predictable is Bitcoin’s adherence to a four-year boom-and-bust cycle. This pattern centers on the programmed halving event, which occurs every four years and reduces Bitcoin’s supply expansion rate. The most recent halving took place in April 2024, cutting the mining reward from previous levels to 3.125 BTC per block—a progression that has occurred four times since Bitcoin’s inception, when the reward started at 50 BTC.

History demonstrates a clear regularity: Bitcoin’s price typically peaks approximately 16 to 18 months after each halving event, followed by an extended bear market lasting roughly a year. In the current cycle, Bitcoin topped out in October 2025, precisely 18 months after the April 2024 halving. This alignment suggests the market is following its established playbook, making further downside pressure likely as the bear phase deepens.

Investor Psychology: Why the Boom-Bust Pattern Repeats

The persistence of this cycle reveals an uncomfortable truth about cryptocurrency markets: they remain fundamentally driven by individual investor sentiment rather than rational valuation. Zheng explains that the four-year pattern proves extremely difficult to break due to predictable human behavior patterns.

Individual investors tend to follow the same psychological script repeatedly—buying aggressively during periods of hype and excitement, then panic-selling when losses mount. This procyclical behavior continuously reinforces the boom-and-bust dynamic that has characterized crypto markets for over a decade. Because of this recurring pattern, Bitcoin continues to behave like a speculative trading vehicle rather than a safe-haven asset comparable to gold.

The implication is sobering: as long as retail participation dominates and institutional adoption remains minimal, the four-year cycle will likely persist. Zheng emphasizes that “individual investors’ psychological behaviors” make breaking this pattern extraordinarily challenging. The market appears trapped in a behavioral loop where the same dynamics replay with each new cycle.

Institutional Adoption Remains the Missing Piece

One factor that could theoretically disrupt the cycle is meaningful institutional investment. However, Zheng argues that institutional adoption has progressed slowly and remains limited in scope. Crypto ETFs and companies holding digital assets as treasury reserves currently represent only about 10% of the broader cryptocurrency market.

This structural reality creates an additional risk factor. Certain firms that purchased digital assets for their balance sheets may face pressure to liquidate holdings to meet debt servicing obligations during downturns. Such forced selling could trigger a vicious cycle of accelerating losses. Zheng warned that if multiple institutions simultaneously reduce their crypto exposure to manage financial obligations, the cascade of selling pressure could deepen the bear market significantly beyond current expectations.

The absence of substantial institutional conviction means that retail-driven psychology remains the dominant market force. Until institutions meaningfully diversify into cryptocurrency as a core asset class—rather than as a speculative position—the market will likely remain vulnerable to the cyclical patterns that define its history.

Prediction Markets Gain Traction Amid Volatility

Interestingly, amid Bitcoin’s volatility, new opportunities are emerging in adjacent sectors. A newly launched venture capital firm, 5c© Capital, is focusing specifically on companies building infrastructure around prediction markets. The fund, backed by leadership from prominent prediction market platforms Polymarket and Kalshi, aims to raise up to $35 million and deploy capital across approximately 20 early-stage startups over a two-year period.

The fund’s focus extends beyond prediction market exchanges themselves, instead targeting infrastructure, data tools, liquidity provision systems, and compliance frameworks. This strategic positioning reflects the rapid expansion of prediction markets, which have experienced significant growth in trading volumes, user acquisition, and platform interest. The initiative has already attracted more than 20 early investors, including portfolio managers from major firms like Millennium Management.

This development illustrates that while crypto crashing cycles continue, the industry evolves and develops new applications and financial infrastructure around digital assets. Even during downturns, innovation and capital deployment persist in segments perceived as foundational to the broader ecosystem’s long-term viability.

The outlook remains challenging in the near term, but the cryptocurrency landscape continues to develop complexity and institutional infrastructure alongside market cyclicality.