Bitcoin (CRYPTO: BTC) could face further downside toward the $60,000–$40,000 range as the market remains in a mid-cycle drawdown, according to analyst Benjamin Cowen.

No Bottoming Signals Yet

In a Friday podcast, Cowen says Bitcoin's bottom is likely not formed, arguing that typical capitulation signals haven't appeared yet.

He points to key valuation metrics, like realized price and balance price, that BTC has not yet broken below, a move that historically aligns with final market bottoms.

Cowen estimates this cycle could ultimately see a ~70% peak-to-trough decline, consistent with prior bear markets.

He also points to declining social interest and limited retail participation as signs that the market has not reached a final capitulation phase.

ETF Inflows, Regulation And Macro Factors

Cowen also points to macro headwinds that could extend the downturn:

  • Inflation pressures, including rising energy costs
  • Tight Federal Reserve policy with limited room to ease
  • Long-term holders selling into strength

He argues that ETF inflows and regulatory tailwinds are not strong enough to offset selling pressure in the near term.

While institutional demand exists, it is being offset by long-term holders selling into strength, and there is not enough new retail demand to sustain a rally. As a result, he expects continued volatility, lower highs, and lower lows, with potential downside.

Overall, Cowen's view is that Bitcoin and the broader crypto market are still in a digestion phase after the previous bull run.

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