Despite the surge in institutional adoption and spot ETF inflows, Bitcoin remains vulnerable to steep corrections, according to BitMine chair Tom Lee.
Speaking in an interview with Anthony Pompliano on Thursday, Lee warned that Bitcoin could still face 50% drawdowns, even amid its growing acceptance among traditional financial institutions.
“I’m sure there will be 50% drawdowns,” Lee said, countering claims that Bitcoin’s volatility will fade as Wall Street embraces the asset.
Bitcoin is up 2.30% over the past seven days
Bitcoin Still Moves With the Stock Market
Lee emphasized that Bitcoin continues to mirror — and often amplify — the movements of the stock market, suggesting that institutional participation doesn’t necessarily reduce volatility.
“The stock market has had frequent 25% drawdowns,” he noted. “If the S&P is down 20%, Bitcoin could be down 40%.”
According to Lee, while the stock market has made progress over the past six years, it has also experienced multiple sharp corrections — and Bitcoin’s performance still correlates closely with those downturns.
‘Longer Cycle’ Could Delay the Next Peak
Lee added that Bitcoin appears to have broken from its typical four-year halving cycle, which would normally indicate a price peak around October. Instead, he believes a “longer cycle” is developing, potentially extending Bitcoin’s bull run beyond past historical patterns.
Despite his short-term caution, Lee remains bullish long-term, reiterating his year-end target of $200,000–$250,000 for BTC.
A 50% correction from that level, he said, would place Bitcoin around $125,000 — still above its previous all-time high near $110,000.
Echoes of Past Market Corrections
Lee’s comments align with those of veteran trader Peter Brandt, who recently warned that Bitcoin’s price structure resembles the soybean market in the 1970s, just before a 50% crash.
Bitcoin’s history supports the possibility of such steep pullbacks. After hitting $69,000 in November 2021, BTC plunged nearly 50% within three months to around $35,000 by early 2022.
However, some industry leaders — including MicroStrategy’s Michael Saylor — disagree, claiming that Bitcoin’s institutional maturity and adoption have fundamentally changed its risk profile.
“Winter is not coming back,” Saylor said in June, expressing confidence that deep bear markets are a thing of the past.
Even as institutional demand and ETF inflows reshape the market, Bitcoin’s DNA of volatility remains intact, Lee cautions. For investors, the takeaway is clear: Wall Street adoption doesn’t eliminate risk — it just makes the stakes higher.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.
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