Bitcoin is now firmly entrenched in the deepest phase of a **bear market**, with the potential for further significant declines, according to CK Zheng, founder of crypto investment firm ZX Squared Capital.

Zheng warns that **Bitcoin could drop another 30% in 2026**, citing the ongoing **Iran war** and the powerful **four-year cycle** as key catalysts. The world's largest cryptocurrency has already nearly halved since hitting a record high of over $126,000 in October last year, currently trading around $68,000.

## The Four-Year Bitcoin Cycle

Crypto investors often reference the **"four-year cycle"** – a pattern where prices surge, crash, and then recover, centered around the quadrennial mining reward halving.

The halving, most recently implemented in April 2024, is a programmed event that halves Bitcoin's supply expansion rate every four years. Currently, **3.125 BTC** are emitted as rewards for each block mined, down from the original 50 BTC at launch after four halving events.

Historically, Bitcoin's price tends to peak about **16–18 months after a halving**, followed by a bear market that typically lasts about a year. With BTC topping out in October last year, roughly 18 months after the April 2024 halving, the cycle appears to be playing out once again.

Zheng emphasizes that this cycle is proving **extremely difficult to break** due to human psychology. "The 'Four-year crypto cycle' momentum is gaining strength and is extremely difficult to break due to individual investors' psychological behaviors," he explained.

Individual investors tend to behave predictably – buying during hype and selling during panic – which reinforces the **boom-and-bust pattern** that has defined crypto markets for over a decade. Because of this, Zheng notes that Bitcoin still trades more like a **speculative asset** than a safe haven like gold.

He also highlights that **institutional adoption of Bitcoin remains slow and limited** at this stage. Some firms that have purchased Bitcoin as a treasury asset may be forced to sell during this bear market, potentially creating a **vicious cycle** of selling pressure.

"The total size of crypto ETFs and Digital Asset Treasury companies is only around **10% of the whole crypto market**. Some Digital Asset Treasury firms may be forced to sell cryptos to meet certain debt servicing requirements during this bear market, which may create a vicious cycle," Zheng cautioned.

For now, Zheng's outlook is clear: **crypto's bear market may have further to run** before the next cycle begins.

Bitcoin is now firmly in a deep bear market and could fall another 30% in 2026, firm said.

Bitcoin's Bear Market Deepens: Expert Warns of 30% Crash in 2026 Amid Four-Year Cycle

**Bitfarms**, a Canadian company, is making a strategic shift from **Bitcoin mining** to **AI data centers**, a move that could redefine its future. Last month, the board approved plans to relocate the company to the U.S. and rebrand as Keel Infrastructure.

With shares trading at just over $2, adding Bitfarms to your portfolio is an affordable entry point. But is this an early opportunity for life-changing returns?

![A data center being constructed.](https://g.foolcdn.com/image/?url=https%3A%2F%2Fg.foolcdn.com%2Feditorial%2Fimages%2F855631%2Fdata-center-construction.jpg&w=3840&op=resize)
*Image source: Getty Images.*

The pivot to **AI infrastructure** is gaining traction among Bitcoin mining companies, driven by financial logic. Instead of mining a volatile cryptocurrency with rewards halving every four years, they now provide data center capacity for top AI firms.

To illustrate the potential, **Cipher Mining**, another miner transitioning to AI, recently signed a 15-year lease with **Amazon Web Services** worth approximately $5.5 billion, or $367 million annually, for 300 megawatts of capacity.

Bitfarms boasts an impressive **2.1 gigawatts** in its North American energy portfolio. In November, it secured a binding agreement with an unnamed American multinational for **$128 million** to provide 18 megawatts of data center capacity. If Bitfarms continues to land such deals, its revenue and share price could surge.

However, competition for AI hosting contracts is fierce, with rivals like **Applied Digital** and **Equinix** in the mix. The transition is costly, and Bitfarms is already operating at a loss, with $96 million in trailing net losses.

Given the intense competition, Bitfarms may not be a guaranteed millionaire-maker. It offers high-risk, high-reward potential, so investors should approach with caution and consider their risk tolerance.

Bitfarms is moving into AI infrastructure and has already landed a nine-figure deal.

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