TLDR
- Bernstein maintained its $150,000 bitcoin target despite a 54 percent fall from October’s cycle peak.
- Strategy bought about 175,000 BTC in 2026, making it a central source of demand.
- Bernstein said Strategy’s balance sheet reduces the chance of large forced bitcoin sales this year.
- Spot bitcoin ETFs saw outflows, but treasury companies kept overall bitcoin flows positive in 2026.
- U.S. miners are selling bitcoin as several firms shift resources toward AI data center operations.
Bitcoin has entered a bear market that has erased about 54 percent from its October 2025 peak near $125,000, according to a Bernstein note cited in market reports. The decline has taken the foremost cryptocurrency back toward recent lows around $60,000 before it recovered to roughly $63,000. Bernstein analysts, led by Gautam Chhugani, said the correction remains smaller than the 75 percent to 90 percent drawdowns seen in earlier cycles.
The firm kept its $150,000 year-end bitcoin target, while describing that forecast as ambitious after the steep market reset. Bitcoin traded around $62,600 on July 6, according to price data cited in the report. Bernstein said the downturn has lasted three quarters from the cycle high, compared with the 12 to 15 months seen in past corrections.
Bitcoin Drawdown Remains Below Past Cycle Crashes
Bernstein said the shallower decline may reflect a more mature crypto market, although the analysts did not state that the downturn had ended. The firm noted that the current correction remains severe by traditional market standards, even though it is less extreme than previous bitcoin cycle declines. The report presented the market as weak but not showing the same stress levels seen during older crypto bear markets.
Flows into bitcoin products also showed a more balanced picture than market sentiment suggested, according to Bernstein. Treasury companies and exchange-traded funds brought in a combined $10 billion in 2026, compared with $60 billion in 2025. Spot bitcoin ETFs recorded $5.5 billion in outflows against a $74 billion asset base.
The analysts said ETF withdrawals looked limited when viewed beside bitcoin’s roughly 50 percent price decline. They added that treasury companies remained the main source of positive net flows during the year. In a market where liquidity has been concentrated in AI-related equities, Bernstein said bitcoin’s flow picture appeared less negative than price action alone suggested.
Strategy Remains Central to Bitcoin Demand
Strategy has purchased about 175,000 BTC for roughly $14 billion in 2026, lifting its total holdings to 847,363 BTC, according to company filings cited by Bernstein. The firm’s buying has made it a major source of demand during a period when other parts of the market have weakened. Bernstein said Strategy remains a net buyer of bitcoin despite investor concerns about possible balance sheet pressure.
The analysts addressed concerns that Strategy could be forced to sell bitcoin to meet obligations linked to debt, dividends, or preferred securities. STRC, the company’s primary preferred perpetual offering, traded at $87.87 against a $100 face value. Bernstein said Strategy had enough liquidity to cover cash dividends and interest for more than 17 months.
The note said Strategy’s debt liabilities equal about 13 percent of its bitcoin collateral value, with the next principal payment of around $1 billion due in the third quarter of 2028. Its $15 billion in preferred principal was described as perpetual long-term capital. Bernstein said these conditions made large forced bitcoin sales from Strategy unlikely.
Miners Sell as AI Data Center Shift Expands
Strategy’s bitcoin accumulation has helped offset selling by major U.S. bitcoin miners, according to Bernstein. The analysts said several listed miners are redirecting resources toward AI data centers as mining economics remain under pressure. They expect leading U.S.-listed miners to move away from bitcoin mining over time.
The report said international operators in Southeast Asia, Central Asia, and Latin America are absorbing hash rate share as U.S. miners reduce exposure. Overall network hash rate has fallen by about 11 percent year-to-date on average, according to the note. U.S. miners’ share of total network hash rate has also declined over the past two quarters.
Bernstein also cited continued progress in crypto regulation and tokenization as areas to watch during the market reset. The note referred to stablecoin rulemaking under the GENIUS Act and the rollout of crypto perpetual futures in the United States through Kalshi and Coinbase. Tokenized real-world assets have reached about $52 billion, while Bernstein said bitcoin flows remain a key measure for any recovery.
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