Bitcoin staged a limited recovery after dipping back toward the $60,000 area, trading up to near $63,000 from that recent low. The move leaves the cryptocurrency approximately 54% below the cycle high of about $125,000 reached in November 2025.
Analysts at Bernstein, led by Gautam Chhugani, emphasize that the current decline has been materially less severe than the 75% to 90% corrections observed in prior cycles. "Although it is unclear if we are completely out of the woods... this crypto bear market has been milder than the previous drawdown," the team wrote.
Flow dynamics this year have differed from 2025. Across 2026 so far, bitcoin treasury companies and exchange-traded funds have added about $10 billion of supply to the market, compared with roughly $60 billion the prior year. Within that total, Bitcoin ETFs have recorded net withdrawals of $5.5 billion year-to-date from a $74 billion asset base. Those ETF outflows have been at least partially counterbalanced by purchases from corporate treasury holders, with Strategy identified as a primary buyer.
Bernstein examined Strategy's balance sheet and preferred shares in detail. Strategy's STRC preferred shares have experienced price volatility and presently trade at $87.87, below their $100 face value. The firm maintains enough liquid resources to cover obligations, with approximately 17 months of cash on hand to service dividend and interest commitments. Debt outstanding accounts for just 13% of the value of Strategy's bitcoin collateral, according to Bernstein.
"It looks unlikely any major Bitcoin forced supply could come from Strategy and it continues to be a net buyer in the market," the analysts wrote, highlighting Strategy's role in offsetting some ETF outflows.
On the mining front, U.S.-listed bitcoin miners have shifted toward selling and are reallocating capital and operational focus toward AI data center businesses. That strategic pivot has corresponded with a decline in U.S. miners' share of global hash rate, which has fallen by more than 40 basis points over the last two quarters, as international miners in Southeast Asia, Central Asia and Latin America gain share.
Regulatory developments are also moving the market. Bernstein points to ongoing rulemaking under the GENIUS Act concerning stablecoins and notes the introduction of crypto perpetual futures products on U.S. platforms including Kalshi and Coinbase. The analysts describe the passage of the CLARITY Act this year as a coin-flip, underscoring continued uncertainty around federal legislative outcomes.
Summing up the current environment, Bernstein observed: "any crypto correction is painful, but this one has been rather comforting," and added that "Crypto feels like it’s growing up." While the firm remains constructive over the long term, it conceded that its year-end Bitcoin price target of $150,000 "appears ambitious in context of the market correction," even as it continues to expect the broader cycle to eventually turn.