Bernstein: Bitcoin Expected to Bottom Out in $60,000 Range, Poised to Start Recovery Rally Within the Year

**February 2 News Flash** Analysts at Wall Street firm Bernstein predicted on February 2 that the current cryptocurrency market downturn will reverse into a recovery by 2026—this despite Bitcoin trading around $75,000 earlier Monday, a 40% drop from its all-time high. In a client report, analyst Gautam Chhugani and his team noted crypto could still be in a "short-term bear market cycle" but expect that trend to flip this year. Bitcoin may bottom out in the first half of 2024 near "the prior cycle’s peak of ~$60,000" before building a stronger base. The pullback was framed against Bitcoin’s underperformance relative to gold, timed with a year of large-scale gold buying by central banks worldwide. Bernstein noted that as countries like China and India ramped up gold reserve accumulation (with gold’s share of global reserves set to hit ~29% by end-2025), Bitcoin’s market cap has fallen to roughly 4% of gold’s—approaching a two-year low. Despite this weakness, Bernstein argues the past two years have been Bitcoin’s "institutional cycle," marked by a sharp jump in spot ETF assets under management (AUM) to ~$165 billion and growing corporate Bitcoin holdings. The team wrote: "If the digital asset market keeps falling, we don’t expect the U.S. government to stand idly by." On fund flows and market structure, Bernstein noted institutional participation has stayed resilient. ETF outflows since the asset peak have made up only a small share of total holdings, and there’s been no miner-driven leverage collapse like those seen in prior cycles. Bernstein says these factors back its view that the current slump is likely an end-of-cycle adjustment—not the start of a prolonged crypto winter. While short-term volatility could linger, the firm expects the 2026 reversal to lay the groundwork for Bitcoin’s "most impactful cycle"—one whose long-term effects may outpace the traditional four-year market cycle pattern.