Here Is Why Bitcoin Might Not See a Major Drawdown This Cycle

Source: ETHNews Original Title: Here Is Why Bitcoin Might Not See a Major Drawdown This Cycle Original Link: https://www.ethnews.com/here-is-why-bitcoin-might-not-see-a-major-drawdown-this-cycle/ Bitcoin is navigating one of the most unusual phases of its market structure, and new on-chain data suggests the downside may be far more limited than in previous cycles.

According to CryptoQuant CEO Ki Young Ju, Bitcoin is unlikely to face a deep, multi-month drawdown as long as key institutional holders, particularly certain major entities with large BTC reserves, maintain their positions. The latest price-drawdown chart reinforces this message, showing the market in a correction phase but nowhere near historical capitulation levels.

Institutional Positioning Limits the Downside

Ki Young Ju argues that large, long-term institutional holders have shifted the risk landscape. Major institutional positions alone act as a stabilizing force, removing a massive amount of circulating supply. This structural scarcity reduces the likelihood of Bitcoin repeating the deep, 50%-80% drawdowns from earlier eras.

Instead of a classic cycle reset, the data points to a market that absorbs volatility without breaking its broader uptrend. Previous cycles relied heavily on retail-driven liquidity. Today’s cycle is shaped by ETF flows, corporate treasuries, and entities unlikely to panic-sell.

Historical Drawdowns Look Very Different Now

Bitcoin’s price-drawdown heatmap from CryptoQuant highlights the contrast.

Past cycles show deep red blocks, prolonged periods of 40%-80% declines.

But the current cycle is marked by shallow, short-lived pullbacks. Even the recent drop sits around -25%, modest compared to historic norms.

This structural change aligns with Bitcoin’s broader maturation into a macro asset. Every cycle sees less volatility, higher floors, and more predictable consolidation zones.

Sideways Consolidation Is the Most Likely Path

CryptoQuant’s model indicates Bitcoin is in a correction mode, not a breakdown mode. With:

• Reduced selling pressure from early adopters
• Institutional reserves pulling supply off exchanges
• Global liquidity trends shifting as quantitative tightening ends

the path of least resistance is likely sideways consolidation rather than a freefall. Any remaining downside risk appears limited to range-bound movement before the next expansion phase.

The Bigger Picture

This cycle carries new variables—ETFs, large corporate buyers, liquidity-sensitive macro trends—that reshape how Bitcoin reacts to corrections. Ki Young Ju’s assessment suggests Bitcoin may no longer follow the traditional boom-and-bust cadence defined over the past decade.

If major institutional holders maintain their long-term stances, Bitcoin may be entering a slower, more stable phase of its market evolution, one where consolidation replaces capitulation.