From approximately $125,000, the historical high, the price of Bitcoin has fallen to a halved range, weighing heavily on everyone’s minds: the chart shows a steep diagonal line, and social media is filled with cries of “a new long bear market has begun.” The last time people were this panicked was during the collapse of Luna and the bankruptcy of FTX in 2022, when Bitcoin dropped to around $16,000, seen as the desperate bottom of the previous four-year cycle. Although the price is still far above that line now, a pullback of about 50% from the peak is enough to sting everyone who experienced the last round of price drops. The historical high of around $125,000 reached in 2025 was seen as the peak of the “story realization” of this cycle, but has rapidly become a memory more than a year later, with the market beginning to discuss whether a deeper plunge and an 80% historical tragedy might repeat itself. It was at this height of emotion, on June 20, 2026, that Zhao Changpeng, the founder of Binance who had faded from public view, appeared on the Galaxy Brains podcast, discussing with Galaxy's research director Alex Thorn, offering a judgment that was completely different from mainstream panic: the current pullback of about 50% is still within what he calls the “normal four-year cycle” tolerance. Historically, there have indeed been deep pullbacks of nearly 80%, and now only losing half, in CZ's view, is far from out of control and is even part of the cycle’s script. The contradiction lies here – on one side are market participants fixated on net value curves, worried that “a deep bear has just begun,” and on the other side is a seasoned exchange founder who believes prices are still operating within predetermined trajectories. This disparity in perspective determines that the same Bitcoin candlestick can be interpreted as having entirely different futures.

From $16,000 to $125,000: The Peak and Trough of a Cycle

If we pull the timeline back to 2022, the collapse of Luna and the bankruptcy of FTX triggered a stampede, and Bitcoin was thrown down to around $16,000, a range that many considered a bottom that "could never return." Panic liquidations, institutional bankruptcies, and project failures followed, and that long lower shadow on the price chart marks not only the bottom of the previous cycle but also a timestamp for countless accounts’ equity being crushed to the floor.

In the roughly four years that followed, Bitcoin slowly turned upwards amid skepticism, climbing bit by bit from the low of around $16,000, ultimately reaching the historical high of approximately $125,000 in 2025. This range accounts for approximately a five-fold cross-cycle increase from low to high, with the gap between the bottom and the peak completely compressed within a “four-year cycle” price trajectory. Based on this framework, in CZ's eyes, the current pullback of about 50% relative to the high of $125,000 is not a disruptive fall, but rather seems like a normal fluctuation oscillating back and forth between this peak and the previous trough.

Is a 50% Retracement Severe? Historical 80% Warnings

In the conversation on Galaxy Brains, CZ pinned the current round of declines to a specific number – compared to the high of about $125,000, Bitcoin has retraced about 50%. For many new investors who have only experienced one round or half a round of the market, a “halving” is nearly equivalent to a disaster: emotions plummet from greed to pessimism, and social media is full of “bear market confirmed” and “the top has passed” retrospectives and self-deprecation. But CZ immediately throws out another, more striking historical reference – in earlier Bitcoin cycles, the price once experienced a deep pullback of about 80%, which was a real “bloodbath,” corresponding to moments of chain reactions of bankruptcies, collapse of mainstream narratives, and markets left only with liquidation and exits.

Also because of such memories, CZ believes that classifying the current 50% pullback as “historically unprecedented severity” is inaccurate. Historically, Bitcoin has repeatedly dropped by half or more from highs, yet in retrospect, these instances have often been proven to be merely a phase node within a complete cycle rather than a terminal verdict. He clearly pointed out in the interview that the current pullback of about 50%, compared to early instances of often 80% crash-like declines, appears not extreme; if the axes are pulled to encompass the entire four-year cycle, this adjustment seems more like a violent shake within a long-term upward structure, providing the most crucial statistical support for his “normal cycle theory”: prices can fluctuate widely, but as long as the lows continue to rise, the current level of decline still belongs to fluctuations within the trajectory, rather than evidence of disrupted structure.

Rising Lows: Evidence of a "Stronger Fundamental" in CZ's Eyes

Following his thought of “first looking at the cycle, then at the retracement,” CZ next focuses on the position of the lows. He repeatedly emphasizes an experience: the price lows in each Bitcoin cycle historically have always stood above the lows of the previous cycle; the bottom does not oscillate on the same horizontal line, but instead rises stepwise. Even under the extreme pressures of the Luna collapse in 2022 and the FTX bankruptcy, when prices were temporarily forced down to around $16,000, in his narrative, this area viewed as the bottom of the last four-year cycle is still significantly higher than the troughs of earlier cycles, indicating that the market, even at its most panic-stricken moments, did not smash the “floor” back to the old era.

If we stretch the ruler, from this approximately $16,000 “step” to the high point of around $125,000 about four years later, we see an increase in interval of approximately five times. For those who hold onto tokens across cycles, even if the current relative peak has pulled back about 50%, what they see on paper is still a long-term profit curve that is far greater than a single round of fluctuation. CZ uses this point to support his judgment of a “significantly strengthened fundamental”: in his view, being able to elevate the bottom of the new cycle to a higher position after experiencing significant shocks and then walk out several multiples of space from there represents an enhancement in the industry’s capacity. Following this logic, as long as future cycles continue to maintain a stepwise trend of “higher lows than the previous rounds,” his claim of “stronger fundamentals” is not merely an emotional reassurance but a long-term signal that can be visually identified in the price structure.

Panic Selling and Cycle Believers: The Clash of Emotion and Narrative

As the price retraced from the high point of about $125,000 to half, the numerical changes on paper first tore apart emotions: for those who leveraged at highs and rolled short-term trades, a 50% retracement is not abstract statistics but rather a real pressure of margin calls, passive liquidations, profit losses, and even reverting to square one. Thus, voices questioning “has this round already ended” and “are we about to replicate a deeper bear market” quickly amplified, and every weak rebound was interpreted as a conspiracy of “offloading and re-entering,” while the market began to habitually preset lower, even close to historical extremes, target prices.

CZ attempts to mitigate this panic through a four-year cycle framework in the interview, emphasizing that historically there have been drawdowns of about 80%, while interpreting the current round's approximately 50% decline as part of the “normal four-year cycle,” suggesting that the current fierce volatility is merely a breath within a long-term upward structure. Within this framework, the short-term halving of prices could be seen less as a collapse and more as part of the cycle's self-repair. Yet, emotions and narratives become misaligned here: chips driven by the threat of forced liquidation couldn't wait for the next “four years” to prove who is right; while those willing to believe in the cycle see panic selling as an opportunity for redistribution of chips. Ultimately, it is the panic sellers’ “this round is over” narrative or the cycle believers’ “normalization” narrative that dominates, not determined by which story sounds better but by who possesses larger funds and greater patience in this drastically different timescale game.

Historical Repetition or Cycle Evolution? Judgement from the Present

Returning to the interview on June 20, 2026, the framework CZ provides is quite restrained: the current pullback of about 50% from the high of approximately $125,000 still falls within what he sees as fluctuations of a “normal four-year cycle.” On one hand, it is because Bitcoin has historically endured extreme pullbacks of about 80%, making this round less of a disaster by comparison; on the other hand, from the bottom of about $16,000 post the Luna and FTX shock to the peak of around $125,000 within four years, there is still an approximate five-fold increase across the cycle. Moreover, each round's price lows are higher than the previous ones, with this rising low constituting the key support for his so-called “long-term upward structure.” Compared to previous rounds, he also emphasizes that the fundamental conditions of the industry are stronger now, but he deliberately stays at the level of trend and structure without providing any specific price targets or timelines, and does not claim that this round will necessarily replicate existing scripts. For the reader, the key is not to choose sides between the “this round is over” and “normal retracement” narratives, but to acknowledge that any cycle theory may be revised in the future, while simultaneously weighing historical retracement data and the currently perceived more solid fundamentals at the same table, letting positions and rhythms be dictated by verifiable cycles and structural judgments rather than driven by panic or exuberance of a single moment.

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