The ongoing Bitcoin (BTC) market downturn, characterized by a decline of over 20% from its all-time high, is relatively mild in terms of severity and is likely to persist for only 90 days, according to market analyst Timothy Peterson, author of Metcalfe’s Law as a Model for Bitcoin’s Value.
Peterson compared the current correction to ten previous bear markets, which typically occur annually. He noted that only four of those—2018, 2021, 2022, and 2024—were more severe in terms of duration.
The analyst remains optimistic that BTC will not see a significant drop below the $50,000 mark due to strong adoption trends. However, he also believes that based on market momentum, it is unlikely Bitcoin will dip under $80,000. Peterson stated:
“We could see a decline in the next 30 days, followed by a 20-40% rebound sometime after April 15. Around day 120, this movement should be visible in the charts, which could reignite investor interest and drive Bitcoin to new highs.”
Market Reacts to Trade War Uncertainty
A sharp downturn in crypto markets followed the recent escalation of trade tensions after the United States imposed tariffs on several trading partners. The retaliatory measures from affected nations fueled concerns over a prolonged trade dispute, triggering a flight from riskier assets.
Investor sentiment has weakened, leading to reduced exposure to speculative markets like cryptocurrency. Data from Glassnode’s Hot Supply metric, which tracks BTC held for one week or less, plummeted from 5.9% in November 2024 during Bitcoin’s peak rally to just 2.3% as of March 20.
Nansen research analyst Nicolai Sondergaard suggested that crypto markets will likely remain under pressure until at least April 2025, when diplomatic negotiations might ease the tariff situation.
Retail Investors Already Overcommitted
An analysis from CryptoQuant further indicates that most retail traders are already heavily invested in Bitcoin, dispelling the long-held belief that a surge of fresh retail interest will drive prices significantly higher in the short term.
The trade war has also cast doubt on Bitcoin’s role as a safe haven asset. The cryptocurrency’s price has fallen in response to tariff-related headlines, moving in tandem with other risk-sensitive markets, challenging the narrative of Bitcoin as a hedge against economic uncertainty.
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