Bitcoin Crash Alert: Analyst Predicts BTC Drop to $70K "Practical Bottom
Bitcoin is currently facing increased risk of dropping to the $70,000 level within the next ten days, according to several price forecasting models. As of today (April 7, 2025), Bitcoin is trading at $78,036, representing a significant 6.54% decline over the past 24 hours, with the price having fallen from $83,502 to as low as $77,142 during this period.
Timothy Peterson's Analysis Points to $70K Target
Network economist Timothy Peterson has warned that Bitcoin may soon revisit its 2021-era all-time high of around $70,000. In his recent analysis, Peterson questioned whether Bitcoin could drop to $70K in just 10 days, citing his Lowest Price Forward (LPF) metric—a tool with a track record of accurately identifying long-term Bitcoin price bottoms.
"If it continues to track along the 75th percentile bear market range, then 70k would be the practical bottom," Peterson explained in his analysis.
This prediction is supported by historical data from Peterson's LPF model, which last month indicated that Bitcoin had a 95% probability of maintaining the 2021 highs as support. The model has proven reliable in the past, successfully identifying the $10,000 price floor in mid-2020—a level Bitcoin never breached after September of that year.
Peterson also highlighted how quickly market sentiment can shift, noting that "Bitcoin went from 75% chance of having a positive month to a 75% chance of having a negative month in just 2 days."
Market Sentiment and Options Data
The bearish outlook isn't limited to Peterson's model. Glassnode, a respected on-chain analytics firm, recently observed that many traders are seeking protection against further market turbulence.
"Puts are trading at a premium to calls, signaling a spike in demand for downside protection," Glassnode reported on April 4. This skew is most pronounced in short-term options contracts, reflecting a level of fear not witnessed since Bitcoin was trading in the $20,000 range in mid-2023.
However, Glassnode also pointed out an interesting disconnect: despite elevated fear levels, Bitcoin hasn't experienced the same breakdown that equities suffered following recent tariff announcements. They noted that "panic is elevated, but price is holding. That's often what a bottom looks like."
Historical Context of Bitcoin Bear Markets
To better understand the current situation, it's helpful to examine Bitcoin's previous bear markets:
| Bear Market Period | Price Drop | Duration | Catalyst |
|---|---|---|---|
| June-Nov 2011 | $42.67 to $2.91 | 5 months | Mt. Gox hack |
| Dec 2013-Aug 2015 | $1,653 to $255 | 630 days | Mt. Gox collapse, regulatory concerns |
| Dec 2017-Dec 2018 | $20,000 to $3,200 | 12 months | ICO crackdown, exchange hacks |
| Jan 2025-Present | $109,350 to $78,036 | 3+ months | Trade war concerns, regulatory uncertainty |
The current downturn, which began after Bitcoin reached its all-time high of $109,350 in January 2025, has seen a 28% decline so far. While significant, this is less severe than previous bear markets, which saw drops of 77-93%.
Technical Indicators and Market Phases
Several technical indicators confirm the bearish trend. Bitcoin is currently trading below its 200-day moving average, with the Relative Strength Index (RSI) showing oversold conditions. The Fear & Greed Index has plummeted from neutral territory to extreme fear levels.
Bear markets typically unfold in phases:
- Reversal Phase: Prices fall rapidly from all-time highs
- Bottoming Phase: Prices move sideways as weak hands exit
- Accumulation Phase: Long-term investors begin accumulating
- Transition to Bull Market: Fundamentals improve and optimism returns
Based on current indicators, Bitcoin appears to be in the bottoming phase, with signs of accumulation by long-term holders despite the prevailing fear in the market.
Trade War Impact and Macro Factors
The primary catalyst for the current downturn appears to be the escalating US-led trade war, which has dampened investor sentiment toward risk assets. This aligns with historical patterns showing that Bitcoin's correlation with traditional markets can vary greatly depending on broader economic conditions.
During the COVID-19 market crash in March 2020, Bitcoin plummeted alongside traditional markets, challenging the notion that it serves as a safe haven during extreme market stress. However, the subsequent economic uncertainty drove increased interest in Bitcoin as an alternative store of value.
Conclusion: Bottom Formation or Further Decline?
While the prospect of Bitcoin dropping to $70,000 might seem alarming, several factors suggest this could represent a "practical bottom" rather than the beginning of a prolonged bear market:
- The current price action shows Bitcoin holding steady despite elevated fear levels
- Options market data indicates extreme pessimism, which often precedes market reversals
- Long-term holders appear to be accumulating rather than selling
- The potential $70K support level coincides with the previous cycle's all-time high
As Glassnode aptly noted, the combination of "rising panic without a price collapse" often characterizes market bottoms. Whether Bitcoin reaches the $70K level in the coming days remains to be seen, but the convergence of technical, sentiment, and on-chain indicators suggests that such a level could indeed represent a strong support zone and potential turning point for the market.