Bitcoin Bear Market: Two Paths, Long-Term Outlook Remains Optimistic

According to Grayscale's latest research, Bitcoin has fallen more than 50% from its all-time high in October 2025 (approximately $125,000), breaking below the $60,000 mark. Grayscale believes this decline is a cyclical adjustment within a long-term upward trend, not a trend reversal.

Recent pressures mainly stem from the Federal Reserve's hawkish shift, uncertainty surrounding the Clarity Act legislation, leverage pressure on Strategy, and quantum computing security concerns. In particular, after Trump nominated Kevin Warsh as Federal Reserve Chairman, market expectations shifted from rate cuts to rate hikes this year, weakening Bitcoin's resilience to devaluation.

Grayscale proposes two possible scenarios:

1. Baseline Scenario: If the Clarity Act passes smoothly, Strategy improves its debt structure, and the Federal Reserve pauses rate hikes, the current price may be nearing the bottom of the cycle.

2. Pessimistic Scenario: If the bill stalls, digital asset companies continue deleveraging, and inflation forces rate hikes, the price still has room to fall.

However, the gains in this bull market have been relatively moderate; institutional funding is more stable, and Grayscale expects the pullback to not repeat the historical peak decline of about 80%, and reiterates its confidence in the long-term growth of public blockchains and digital assets over the next decade.