Bitcoin Poised for 30% Plunge in 2026, Warns Investment Firm
Crypto investment firm ZX Squared Capital has issued a stark warning, predicting Bitcoin could fall an additional 30% during 2026. Founder CK Zheng identified the asset's entrenched "four-year cycle" and geopolitical tensions as key drivers for the continued downturn. The cryptocurrency is already down nearly 50% from its record high of over $126,000 set in October 2025, trading at approximately $68,000 as of March 7, 2026.
Four-Year Cycle Strengthens on Predictable Investor Psychology
Zheng's analysis centers on Bitcoin's historically consistent four-year cycle, which is anchored to its quadrennial mining reward halving. The most recent halving occurred in April 2024. Historically, Bitcoin's price peaks 16 to 18 months post-halving, followed by a significant bear market. The peak in October 2025 aligned with this 18-month timeline, suggesting the current downturn is a predictable phase of the cycle. According to Zheng, this boom-and-bust pattern is difficult to break because it is reinforced by "individual investors' psychological behaviors." He argues that this dynamic keeps Bitcoin trading as a speculative asset rather than a safe-haven store of value like gold.
Corporate Selling Risk Looms as Institutional Share Remains at 10%
The forecast also highlights the slow pace of institutional adoption as a significant headwind. Zheng noted that the total capital in crypto ETFs and corporate digital asset treasuries accounts for only about 10% of the entire crypto market. This leaves the market susceptible to wider swings driven by retail sentiment. Furthermore, Zheng warned of a potential "vicious cycle" where companies holding bitcoin as a treasury asset could be forced to liquidate their positions to meet debt servicing requirements during a prolonged bear market, creating additional selling pressure and accelerating the price decline.
