Since its creation, bitcoin was like a daring mountaineer scaling new peaks, rarely looking back toward the ledges he left behind. Its price has rarely retraced previous bull market highs, even during long and grueling bear markets.
But this pattern appears to have changed, suggesting that the market has matured, and that the era of meteoric parabolic gains is behind us.
BTC is trading near old high
Bitcoin has hovered around $70,000 since the start of February – well below the peak of $126,000 reached during the 2023-2025 bull run.
This $70,000 threshold is important because it represented the all-time high during the 2019–2022 market cycle. In other words, this bear market has retraced back to a previous high.
It’s unusual. During previous bear markets, such as those of 2014 and 2018, bitcoin never returned to the highs of previous cycles. The exception was 2022, when prices fell below the 2017 high of $20,000. At the time, analysts dismissed this as an anomaly, attributing it to cryptocurrency scams and massive deleveraging.
What makes the current downturn remarkable is that it is occurring without any extreme catalyst. The market has simply returned to a previous high as part of the natural flow of a down cycle.
Slowdown in growth and the law of diminishing returns
Each new bullish phase does not generate the parabolic gains of the past. Pushing prices well beyond previous highs becomes more difficult, making retracements back to old highs more natural. In other words, the previous peaks are no longer untouchable.
This is a clear example of the law of diminishing returns. As bitcoin becomes more expensive, driving up prices requires larger and larger amounts of capital. The days when modest inflows could trigger massive rallies are largely gone, making price movements more measured and predictable.
Looking at historical growth highlights this trend:
- The 2013 peak was 38 times that of 2011.
- The 2017 peak was 16 times higher than in 2013.
- In 2021, the increase slowed to only 3 times the 2017 level.
- The 2025 peak at over $126,000 was less than twice the 2021 peak.
Although prices continue to rise, the pace of growth is steadily slowing.
Institutionalization and broader market participation
Part of this slowdown stems from the institutionalization of Bitcoin and the growth of the derivatives market. Traders now have structured ways to bet on the volatility, timing and direction of the market, not just on rising prices. This expanded participation has moderate extreme oscillations.
This is very different from the days before 2020, when trading was mainly limited to buying and selling in the spot market. At that time, only bullish bitcoin believers actively participated, often entering the scene at the first sign of decline.
Behavioral Patterns and Perspectives
Old highs often act as strong support levels due to a behavioral concept called anchoring bias, where traders fixate on previous higher highs as reference points.
Many of those who missed the initial breakout tend to buy when prices return to those familiar levels, fueling the next phase of an uptrend. This behavioral trend, combined with the self-reinforcing nature of supports and resistances, helps explain why the recent downtrend has stalled around $70,000.
A strong rebound from this level could indicate that the bear market has run its course, similar to late 2022 when the downtrend stopped around $20,000.
However, if the law of diminishing returns is any indication, the next uptrend could be more measured and “in the traditional way”, rather than the frenzied rallies of the old speculative days.
