Bitcoin's Historic Milestone
Bitcoin crossed the $120,000 mark for the first time in history this week, extending a rally that began in November 2025 and has already generated $1.2 trillion in market capitalisation gains. The move has reignited the perennial debate: is this the supercycle, or just another cycle — destined to end in a violent correction?
The structural case for a prolonged bull market is stronger than in previous cycles. Spot Bitcoin ETFs approved in the United States have channelled over $48 billion in institutional inflows since launch. BlackRock's iShares Bitcoin Trust alone holds more Bitcoin than any entity other than Satoshi Nakamoto's original wallets — a fact that would have seemed fantastical five years ago.
The Halving Effect
The April 2024 halving reduced new Bitcoin supply to 450 BTC per day — and historically, price discovery following halvings takes 12–18 months to fully express itself. By that timeline, February 2026 falls squarely in the peak window predicted by four-year cycle analysts.
On-chain metrics support the bull case. Long-term holder supply is at an all-time high, suggesting conviction among experienced participants. Exchange reserves are near decade lows, meaning less immediate sell pressure from traders. The MVRV Z-Score — a measure of market value relative to realised value — sits at 3.2, elevated but below the 7.0+ levels that historically marked cycle tops.
"This is structurally different from 2021. The demand base is institutional, the supply shock is real, and the regulatory clarity is finally here." — Cathie Wood, ARK Invest
The Bear Case
Sceptics point to stretched valuations, rising leverage in derivatives markets, and regulatory uncertainty — particularly a potential SEC review of the ETF approval structures. History also shows that Bitcoin's most violent corrections often follow its greatest euphoria. A 60-70% drawdown from current levels — to approximately $36,000-$48,000 — would be entirely consistent with past cycles, even within an ongoing bull market.