Bitcoin: Why the Pullbacks Are Becoming Less Severe

The major bitcoin corrections are losing magnitude. They have gone from about 85% in the early cycles to 84%, then 77%, and nearly 53% in the current cycle. Data compiled by Galaxy Research show this progressive compression, even though the 2025-2026 cycle bottom is not yet definitively confirmed.

Bitcoin absorbs corrections that are less and less deep

The story begins with a fairly clear series. In 2014, bitcoin lost about 85% from its peak. After the arrival of futures and Wall Street in 2017, the next decline still reached 84%. The 2020-2021 market welcomed Strategy, Tesla, and new institutional investors. Bitcoin then corrected by about 77%.

The current cycle stops for now around -53%. It was already noted in February that the on-chain signals remained consistent with the four-year cycle, despite a different market structure. Between -85% and -53%, the gap reaches 32 percentage points. Proportionally, the current correction is nearly 38% less deep than that of the first major cycle considered.

The change does not come from a single event. Spot Bitcoin ETFs, companies accumulating BTC in treasury, and the broadening investor base have added buyers absent in early cycles. This does not prevent declines. For now, they simply stop higher.

Bitcoin rallies are shrinking too

The counterpart appears when looking at the bullish phases.

Bitcoin.com lists gains of about 580x, 130x, 22x then 8x between cycle lows and following highs. The decrease is spectacular. The multiple between the first and fourth episodes has been divided by more than 72. 

A bitcoin that falls less violently therefore also produces, so far, less extreme rallies. This evolution aligns with the debate opened in recent months about market maturity. Michael Saylor considers that the traditional four-year cycle is losing weight with the arrival of institutional capital and ETFs.

The phenomenon remains difficult to attribute precisely. ETFs can cushion some sales thanks to steady demand. They alone cannot demonstrate why the amplitude decreases.

The halving also plays a less mechanical role than in Bitcoin’s early days. Each halving still reduces the issuance of new BTC, but this new supply now represents a much smaller fraction of a market that has become considerably larger. Less new scarcity to absorb. Much more capital already present.

The four-year cycle has not yet disappeared

The compression of movements is not enough to bury the historic cycle. Galaxy Research notes that previous sequences continue to follow a close chronology: bottom, halving, peak, then new correction. The three completed cycles also placed their bottom about 12 to 13 months after the peak. 

The current cycle remains incomplete. Here lies an important limit to the figure of -53%. If bitcoin registers a new low, this correction will mechanically become deeper. The percentage should therefore be read as a snapshot of the market at this stage, not as a definitive assessment.

Meanwhile, institutional presence remains very real. US Bitcoin ETFs attracted another $101.15 million on September 2, after a strong withdrawal session. The 2026 market thus looks less like early cycles in amplitude, but still retains some of their rhythm. Corrections go from 85% to 53%. Rallies also shrink. To know if this compression has become structural, the real bottom of the current cycle must first be known.