Bitcoin's BTC$77,681.16 recent gains — it's added almost 15% this month — aren't enough to convince some industry observers that the largest cryptocurrency has escaped the bear market it entered in October. It is, after all, still 40% below its record.

There may be deeper drops to come, with some, unidentified, forecasters, predicting a drop to as low as $40,000, a 70% drop from its all-time high. The figure comes from bitcoin analyst James Check, who says such a move is unlikely. While not impossible, he said in a post on X, it would be statistically extraordinary.

"Just to make a point, for the bears who want to see $40k.

You may well end up right. However, consider that on a mean reversion basis, averaging relative to nine anchors (a mix of technical, onchain, trend, fast, slow etc), it is a Q 0.4 event.

Lower than $2 Bitcoin in 2011."

After climbing over $126,000 in October, bitcoin slid more than 50% to around $60,000 in February before stabilizing. It was trading Friday near $78,000.

Talking to the bears, Check said their predictions warrant closer scrutiny.

Check points to the Bitcoin Mean Reversion Index, a composite model that averages multiple key valuation metrics, including the 200-week moving average, realized price, power law trend and a number of volume-weighted average price measures. The index ranks bitcoin’s price on a historical percentile basis.

When modeled at $40,000, bitcoin registers as a “0.4 event,” meaning it would fall in the 0.4th percentile of all daily closes.

“That’s below any meaningful deviation across all major anchors,” Check said.

For context, Check says that would be equivalent to bitcoin trading below $2 in 2011 on a relative basis. By contrast, today’s price sits around the 31.5th percentile, historically weak but within normal correction ranges.

“There’s no zero probability in markets,” Check added, “but this would be a near-unprecedented outcome.”