Why Is Crypto Crashing? The Four-Year Cycle Deepens Bear Market Pressures

Bitcoin plunged from its October 2025 peak of over $126,000 to current levels around $70,670, and the decline may continue. According to CK Zheng, founder of crypto investment firm ZX Squared Capital, the cryptocurrency could slide another 30% as we move through 2026. The fundamental question: why is crypto crashing so predictably? The answer lies in a deeply ingrained four-year pattern that keeps the world’s largest digital asset behaving more like a speculative bet than a true safe haven.

Understanding Bitcoin’s Predictable Four-Year Boom-Bust Pattern

The “four-year cycle” has become the defining rhythm of crypto markets. Every four years, Bitcoin undergoes a programmed halving event—a mechanism that cuts the mining reward in half. The most recent halving occurred in April 2024, reducing block rewards to 3.125 BTC from 6.25 BTC. Historically, Bitcoin’s price peaks approximately 16 to 18 months after each halving, followed by an extended bear market that typically lasts around a year.

This cycle has played out with remarkable consistency. Bitcoin topped out in October 2025—roughly 18 months after the April 2024 halving—suggesting the downturn phase is now in full effect. Zheng points out that this pattern has defined crypto markets for over a decade, making it incredibly difficult to break. The mathematics of the halving are predictable, but the price movements they trigger are driven by something far more fundamental: human behavior.

How Investor Psychology Perpetuates the Crypto Downturn

The real reason crypto crashes on this four-year schedule isn’t mysterious—it’s psychology. Individual investors tend to follow predictable behavioral patterns: they buy aggressively during euphoric bull runs and panic-sell during downturns. This creates a self-reinforcing boom-and-bust loop that has become almost inescapable.

“The Four-year crypto cycle momentum is gaining strength and is extremely difficult to break due to individual investors’ psychological behaviors,” Zheng explained. Because retail investors behave in synchronized ways around predictable events like the halving, they collectively amplify price volatility. Buyers flock in during the post-halving rally, driving prices to unsustainable levels. When reality doesn’t match expectations, they exit simultaneously, accelerating the crash.

This behavioral pattern is exactly why Bitcoin continues to trade as a speculative asset rather than a stable store of value like gold. Institutional adoption—which could theoretically dampen volatility—remains limited. Digital asset ETFs and treasury holdings represent only about 10% of the total crypto market, meaning the retail crowd still dominates price discovery.

Why Institutional Adoption Can’t Stop the Crypto Plunge Yet

The lack of institutional capital is a critical weakness. When some companies do hold Bitcoin as a treasury asset, they may be forced to liquidate during bear markets to meet debt obligations. This forced selling during downturns creates what Zheng calls “a vicious cycle”—institutions selling to raise cash, which pushes prices lower, triggering more panic selling.

“The total size of crypto ETFs and Digital Asset Treasury companies is only around 10% of the whole crypto market. Some Digital Asset Treasury firms may be forced to sell cryptos to meet certain debt servicing requirements during this bear market, which may create a vicious cycle,” Zheng said.

As of late March 2026, Bitcoin trades around $70.67K, up 3.91% over the past 24 hours following geopolitical developments. However, analysts suggest the next major move depends on macroeconomic factors like oil prices and global trade flows, with potential support between $74,000 and $76,000 if risk sentiment improves, or weakness toward the mid-$60,000s if conditions deteriorate.

The Outlook: When Will Crypto Stop Crashing?

The crypto crash won’t resolve until the psychological pattern breaks—and for now, that seems unlikely. The four-year cycle continues to gain momentum precisely because it’s so predictable. Retail investors learn the pattern, expect the rally, feel disappointed when it doesn’t materialize as imagined, and sell in panic. Institutions remain too small to counterbalance this behavior.

For investors watching crypto markets, the uncomfortable truth is clear: without fundamental changes in market structure and participant psychology, the boom-and-bust pattern will likely persist. The current bear market may deepen further before stabilizing, and the next cycle will probably follow the same script. Understanding why crypto crashes—it’s the cycle, the psychology, and the lack of institutional stabilizing influence—is the first step toward managing expectations in this volatile asset class.