Bitcoin may have already established its cycle bottom following two distinct capitulation events, according to James Check, founder and lead analyst at Checkonchain. Speaking on Cointelegraph’s Proof of Thesis show, Check explained that shifts in holder behavior indicate the market has successfully absorbed a substantial amount of selling pressure.
Bitcoin reached an all-time high of just over $126,000 in October 2025 and traded around $77,400 at the time of writing, sitting nearly 39% below its peak. While some traders and historical models have pointed toward a potential low in October 2026 based on a four-year cycle, Check's assessment suggests the necessary bear-market capitulation signals occurred much earlier.
Check categorized Bitcoin's recent downturn into two phases. The first was a February decline toward $60,000, which he termed a "price-pain capitulation" where top-buyers sold at steep losses. The second was a "time-pain capitulation" around $58,000 in June and July, driven by months of sideways price action that forced holders to question a recovery.
According to Check, approximately $300 billion in Bitcoin cost basis was concentrated between $58,000 and $70,000, while roughly 4 million BTC transitioned from an unrealized loss into profit during the subsequent recovery. Long-term holders now control about 80% of Bitcoin wealth and are inclined to wait for higher prices rather than sell after a short-term rebound.
Caution Against Four-Year Cycle Reliance
Check cautioned traders against anchoring strictly to historical four-year cycle dates, arguing there is no mechanical reason for them to repeat. Instead of relying on the calendar, he advised analysts to examine onchain metrics such as cost basis, unrealized and realized losses, and holder profitability to determine market exhaustion.
Grayscale Head of Research Zach Pandl expressed a similar view during an interview on Cointelegraph’s Trade Secrets, stating that prices likely bottomed at $58,000 at the end of June. Pandl noted that the downturn featured less overall despair than previous bear markets, reflecting a bull market that had generated less initial euphoria, and pointed out that Bitcoin's resilience against adverse developments is typically a sign of an oversold asset.
Meanwhile, broader onchain indicators remain mixed. HODL Waves data showed a muted response from short-term dip-buyers in early July, whereas CryptoQuant data indicated that short-term holders had remained partially profitable for 30 consecutive days—a streak that has historically characterized past market recoveries.
