Bear Market or Reset? James Check Explains Bitcoin’s Brutal 80K Washout
Published: 2025-11-27
Status:
Available
|
Analyzed
Published: 2025-11-27
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 22
Prediction
Topic
Status
65% of Bitcoin's realized cap had a cost basis above $95k.
"my base case for some time has been there was a level of about 95k. I won't go into all the details yet unless we want to. But the short of it is about 65% of all that wealth, the realized cap I mentioned earlier. 65% of the wealth was allocated to Bitcoin had a cost basis above 95K."
Incorrect
Bitcoin's price movement from $95k to $80k was predicted to be very quick after breaking below $110k.
"Now we attempted two all-time highs, 124 and then 125. I think it was July and August if I'm not mistaken. August, October. By the time we broke down through 110, starting to go, guys, look, things are looking a little bit hairy. You got to watch that 95K. But once you get to 95K, the trip between there and 80 is probably going to be very, very quick."
Incorrect
The expectation was that Bitcoin would not have a red year in 2025, but by October, a drop to $95k was seen as a bad sign, with a quick trip to $80k expected.
"I think like most people, I didn't expect 2025 to be a red year. However, by the time we got into October, we were starting to say, 'Look, it's getting a bit hairy. You get down to 110, now you're down to 100. Once you get to 95, it's probably in a bad spot and the trip to 80 is going to be fairly quick.'"
Incorrect
The 'true market mean' for Bitcoin is approximately $82k, representing the average cost basis for active investors.
"So, so true market mean it's about 82k and the reason that's an important level is it basically captures the average cost basis for active investors."
Incorrect
The average cost basis for Bitcoin ETFs is $82k, acting as a center of gravity for dollar-based investors in this cycle.
"The average cost basis for all of the ETFs is 82K. And if you think about it this cycle, a $100,000 Bitcoin is a different animal to $10,000 Bitcoin, right? We're just at a whole different we're 10x larger in terms of size. So yes, there's people who still have a lot of coins from much cheaper prices, but the people who actually invested the on a dollar basis, 82k is that center of gravity."
Incorrect
The speaker is a happy buyer of Bitcoin in the $80s but acknowledges that the correction might not be over.
"So, from my perspective and for me as a a long-term hodler, you're going to get me coins in the 80s. I'm going to take them all day. So to answer your previous question, yeah, I'm a very happy stacker down here, but I'm also very aware that we probably aren't done with this correction yet."
Incorrect
Key Bitcoin price levels to watch include a $56k zone and a non-consensus zone in the $70s-$80s, based on the realized price and true market mean.
"there's another onchain price model called the realized price which we have also historically bottomed at. So, these are actually the two very interesting levels. One that like 56k type zone and the other one which is non- consensus is closer to the true market mean in the 80s and the 70s."
Incorrect
The speaker's base case is that Bitcoin may not necessarily fall to the $56k level.
"My base case for now is I actually don't necessarily think we have to go down to the 56k level."
Incorrect
Large holders tend to slow down selling during corrections, completing most distribution and holding capital to reinvest at lower levels.
"I also think that they they do generally speaking slow down when the correction comes in and we start to hit markets like we are now. Generally speaking, they've done most of their distribution by the time that happens and they then have a whole lot of capital on the side, which generally they're patient and they allow the market to come to them and they'll step back in, right? When the Bitcoin gets to a a certain level, they will step back in with some of that capital because who knows if the market goes down low enough, they can buy back their whole position, still have capital on the side."
Incorrect
Despite a 35% market drawdown, ETF outflows are only 3-4%, and ETFs are near their cost basis of $82k, indicating a lack of giving up by these buyers.
"If you look at the ETFs, we've seen about 4% of the Bitcoin that's gone in come back out again. And this is during a 35% market draw down. So in fact, the ETFs are pretty much at their cost basis at 82K. And we're seeing 3 to 4% of the outflows. It's kind of pretty important that we're just not seeing that like, ah, I'm giving up. I don't want to hold this Bitcoin thing anymore and it sucks. We're actually not seeing that type of dynamic. Not yet. Not that I can't change, but at this point in time, we're not seeing that."
Incorrect
The narrative of Bitcoin having horrible drawdowns will disappear when it blasts through all-time highs again, as Bitcoin's nature is to persevere.
"my base case here is right now the whole market is looking at this thing going, 'Oh, Bitcoin still has these horrible draw downs.' Even though it's in the institutional era, it's still, you know, it sucks. When we blast through alltime high again, and we will, that whole narrative is going to disappear because Bitcoin's job is just to be a cockroach and just keep going."
Incorrect
Bitcoin is considered a 10x improvement over gold in almost every way.
"Is Bitcoin a 10x improvement over its nearest analog competitor, gold? Yes, in just about every single way."
Incorrect
Bitcoin will experience diminishing returns as it grows, but will remain a strong asset. Diversification can be achieved by using incoming capital for other assets rather than rotating out of Bitcoin.
"Bitcoin will have diminishing returns. There's no question as anything gets bigger, this will be the case. I still believe it's going to be a kick-ass asset and I can't really see that many other things to buy in place of it, but I can use my capital that's coming in to buy other assets as well to diversify essentially with my income rather than rotating out."
Incorrect
Due to Bitcoin's slow upgrade process, technical solutions for the quantum threat should be initiated now to have the necessary tools ready.
"Bitcoin is a slow moving beast and it's very difficult to change. So the technical side, we really should be starting the process now. So at a minimum, we have the toolbox ready to go."
Pending
Ethereum is not seen as a store of value, as Bitcoin has already claimed that position. Holding ETH is considered a trade or speculation, similar to holding silver.
"I ran this calculation some time because I'm of the view that Bitcoin has already won the store of value asset in the in the digital space. So I I don't see any reason to hold ETH as a store of value. To me that it just doesn't really make sense. It's you know why would you ever hold the second best? It's like holding silver. You're kind of hoping for that 3 weeks out of the cycle where it does better. To me that's not really a savings asset. That's a trade. That's speculation."
Correct
The utility of Ethereum, specifically its gas usage, is questioned, with the speaker having accumulated enough gas usage to cover 255 years with their initial 32 ETH investment.
"If you then go down the next step and say, 'Well, if it's not a store of value, which for me at least, I've convinced myself that it isn't, or more importantly, I can't convince myself that it is, is actually a better way to frame that.' Once you have to then go to the utility angle. People always say it's got more utility. I ran this calculation because like many people, I stacked my 32 ETH back in the day when I was like, I want to be a staker and blah blah blah. And then I ran the calculation on how much gas because there's websites where you can see how much gas you've consumed over your whole time in the market. and I had bought if that with that 32 ETH I'd bought 255 years of gas usage."
Pending
The utility of Ethereum as a gas provider is compared to hoarding gasoline for a house with 12 swimming pools, arguing it's hard to justify its $0.5 trillion market cap based on this utility.
"The analogy here is that I drive a car so therefore I'm going to buy a house with 12 swimming pools and fill them all up with petrol because I might need it at some point. No, I'm just going to go to the petrol station and buy my $15 $20 worth when I need it. So the challenge is when you actually look at the utility case as gas, it's very very hard to justify a half trillion dollar market cap."
Correct
The Zcash rally is attributed to a well-executed marketing plan, reflecting a bearish sign for altcoins as the market focuses on pumping a single token due to a lack of broad market gains.
"No, absolutely not. What what we're looking at here is a very wellexecuted marketing plan by Zcash. Ultimately, it's actually a really bearish sign for the altcoin system. What I believe we're seeing, the market can't get an all all rising tide lifts all boats. Alt season where everything just goes up. I just don't think it's coming. So, the market eventually goes, you know what we should do? We should just pick one token and pump that. Surely, we can pump one. And I just think there's been everyone who's looking for a pump has just gone into one asset. So no, I think it's actually just a very clever and wellexecuted marketing plan by by the Zcash Foundation and everyone's just looking for something because nothing else is going up. So truly I think it's that simple."
Incorrect
While privacy is important, a separate coin like Zcash may not be the solution, given potential issues like inflation bugs, whereas Bitcoin's auditable nature is a key value proposition, despite privacy trade-offs.
"There's definitely an argument for privacy, but that doesn't necessarily mean that you need a separate coin to do it. So, in my view, like if you think about Zcash, they have had probably a nonexploiter, but they have had an inflation bug. And these challenges like you may get an inflation bug in that shielded pool at any time and you just never know. Part of the value proposition of Bitcoin is the fact that you can audit the whole thing. You can see the whole thing. Now, yes, there are trade-offs there in terms of the privacy, and privacy's always been a challenge for Bitcoin and will continue to be a challenge."
Incorrect
Privacy assets face challenges due to KYC requirements on exchanges and the need for peer-to-peer transactions, making their utility limited and the user experience a barrier.
"So the problem with privacy assets is it's all well and good while you're only sending coins within the Zcash shielded pool. The moment no one transacts peer-to-peer. This is just like a fantasy. The moment you touch an exchange, bang, your KYC. what was the point of doing privacy? So the challenge is that like there's a lot of fugazi but it all that last mile problem of the moment that you transact with it suddenly you leave enough metadata where it kind of doesn't matter the user experience will never be there and people just don't use this stuff this way like it's you know I think it's a cute narrative but I just don't think there's any real there there"
Incorrect
Hearing someone in a remote location shilling XRP is considered a strong 'not good' or top signal for the market.
"I have no idea what the price has done since then, but we were out at the it's called the Bitcoin Bush Bash, which is a basically once every or three times a year. Bitcoin is in Australia because it's hard to fly here. We have a conference and it's basically free. People just show up um all around the around the country. And we're in the middle of nowhere. We're five and a half hours outside Sydney, like middle of nowhere. And this bloke overhears us talking about Bitcoin at the pub and goes, 'Oh, are you guys into XRP?' I was like, 'Not good, guys. That's that's a really really bad sign when you're in the middle of nowhere and some dude's shilling you XRP..."
Incorrect
When average individuals, like taxi drivers or outback bush guys, start promoting XRP, it's considered a top signal.
"So either the outdoor the outback bush guy showing you XRP or your taxi driver. Whenever XRP gets mentioned by your average individual that's a top signal."
Incorrect
A catastrophic event with a narrative of the market being dead for a decade, combined with extreme stomach-churning fear, indicates a buying opportunity, while excitement signals a time to sell.
"generally speaking, it's an event. It's a thing. It's an FTX. There's like an event where you just like the narrative is it's dead for a decade and everyone is just absolutely wrecked. you like it's hard to it's hard to know exactly but there's usually an event that has occurred and it's usually catastrophic and everyone goes how could we possibly recover from this it's usually the right time to be stepping in and the exact opposite if your stomach is absolutely churning and this occurs in both bulls and bears by the way if you're looking to sell an asset and you're you're thinking what am I doing this is a terrible idea press on if you feel very excited don't do it and likewise when your stomach is churning you're like I don't know why I'm I can't buy this thing. This is no way it's going lower. Press on. Press on."
Incorrect
The speaker initially believed everyone would eventually understand and adopt Bitcoin, but now acknowledges this is not happening.
"I thought at the start of my Bitcoin journey that everyone was going to work this out and the Bitcoin was going to be everything in everyone's portfolio because how could you not see this? And what I now know is that not happening."
Incorrect
Focus should be on 'smart folks' with capital, as most people will not understand or adopt Bitcoin and prefer to live in their bubble, accepting inflation rather than seeking change.
"What you actually need to focus on are the smart folks in the room because they're the ones with the capital and it's actually rather than expecting the whole world to work it out because they just won't. Most people are going to live in their bubble. They don't want change. They're happy to go with inflation because they would rather not know."
Incorrect
The speaker is more positive about liquidity conditions in markets heading into 2026.
"I look at what's going into 2026 and I'm a little bit more positive in terms of the general outlook for liquidity in markets."
Correct
The 'Genius Act' is seen as a dollar dominance bill, reflecting a global trend towards digitalization.
"The Genius Act. Now, granted, that's a dollar dominance bill. Um I think is the correct way to think about it. But more of the world, I think, of what is really showing is we're going more digital. Things are going to go more and more digital."
Pending
Clearer regulations and market structure bills will make it easier for institutions to invest in Bitcoin as more people join the market.
"And as the regulations become clearer and clearer. We get a market structure bill, it just becomes so much easier for these institutions. They don't have to argue and debate around a table to try and work out should we, shouldn't we, is it a risk. Once enough people have jumped in the pool, it becomes much easier to jump in the pool."
Pending
Both Bitcoin and gold are seen as assets that survive in a debasement and fiscal dominance environment.
"So, from that perspective, it's all one trade. Meaning you basically want to own assets that survive in a debasement, you know, fiscal dominance type environment. Bitcoin has consistently shown that it is a terrific asset for that. And so is gold."
Pending
Gold is acting as a stable asset around its all-time high, providing liquidity for other investments.
"My gold is sitting there doing absolutely nothing, trading around all-time high. I could liquidate that tomorrow and use that capital to start my housing journey."
Correct
Gold serves as a portfolio ballast, with its primary function being to avoid significant losses (e.g., 30%) rather than achieving high returns, particularly when Bitcoin is not an attractive selling point.
"So, the gold is there as the same trade, but its job is not to fall 30%. That's the way that I think about it. It's almost like ballast in my portfolio because both of those assets I'm saving for the house. The gold's job is just to not fall 30% because I need that if I find the right house at the right time and Bitcoin's in a position exactly where it is right now where I don't want to sell it at 87."
Correct
The AI boom is a generational event attracting capital, but eventually the AI bubble will burst, leading to rotation back into undervalued assets like Bitcoin.
"and there's no question that the AI boom right this is a once in a generation event where the AI trade is on capital has no doubt sold Bitcoin sold that sold this and moved into the AI sector so it's just like a relative world there will always be rotation at some point that AI bubble is not going to look as attractive capital's going to have to go somewhere and Bitcoin's going to be undervalued at that point and people are going to rotate so Yes, that's always going to happen."
Pending
A collapse in the AI bubble would likely cause most non-dollar assets to decline in value.
"If we have a collapse in the AI bubble, it doesn't matter what you own. If it's not dollars, it's going down. It's it's going to be that simple."
Pending
Politicians will likely inject liquidity to address a crisis, and Bitcoin is owned as insurance against such policy responses.
"The trade after the trade is going to be that they got to patch over this thing with liquidity because no politician wants to deal with that. That is actually what I own the Bitcoin for. It's the insurance against the response, the policy response that will come into the mix."
Correct
Bitcoin hedges against governments printing money to devalue fiat currency over time.
"What it's hedging is the government's requirement because of politics to print a boatload of money and make that fiat currency worth less over the course of time."
Correct
Liquidity conditions are expected to improve, and a new Fed appointee under Trump is unlikely to be more hawkish.
"my base case is I actually think the liquidity conditions start to pick up. I think they've been pretty hairy actually over the last probably at least three, maybe 6 months. So, I think liquidity conditions been much tighter than people probably recognize. But, I think moving forward, you're right. I mean, J Pal is going to be out and Trump's going to put his own guy in there in the Fed. So, that's I mean, all things being equal, that's not going to be more hawkish."
Pending
Political motivations, including 'freebies' and 'tariff dividends', will likely lead to balance sheet expansion to manage the economy.
"No political group wants to get voted out and they're going to do a bunch of freebies. They're talking about tariff dividends and all sorts of stuff. In many ways, I think the administration in the US right now is just trying to keep the wheels on and they got spot fires all over the place. And at the end of the day, I I think that they're going to have to start balance sheet expansion."
Correct
It's uncertain when 'Qday' (the advent of quantum computing capable of breaking current cryptography) will occur, but innovation suggests it will eventually happen.
"So, the truth is I don't know when QA is. What I am confident is if you leave humans to keep innovating for long enough, eventually we will crack something that can do that."
Pending
The Bitcoin space should focus on technical solutions for the quantum threat, including researching and planning new address formats and cryptographic signature schemes.
"So, my view for the Bitcoin space, there's a handful of debates or topics that need to be covered. The first one is uh what kind of address formats do we do? How do we actually solve the cryptographic signature scheme? And that's a technical problem. I'm of the view that should be our focus because we need to have the options at a minimum researched, planned, code written, reviewed."
Correct
The priority regarding the quantum threat is developing the technology for individuals to secure their coins, before debating issues like freezing coins.
"So, my simple framework is first things first, we need the tech so that people can choose to secure their coins. That's the first thing we need to do. That's a process. Get that done. then we can start debating whether we freeze people's coins or not."
Pending
Most altcoins, including L1s and memecoins, are seen as tremendously overvalued with weak fundamental cases, making them unattractive to institutional investors.
"So to me, I just don't see the institutional narrative because they are going to run the numbers and they're going to see that most of these things are tremendously overvalued. I struggle to see the fundamental case for a lot of these things, whether it's L1s and for the token landscape. I mean, you know, Fartcoin and the memecoins is kind of its own thing."
Correct
Most altcoin tokens offer no ownership, dividends, or cash flows, making them purely speculative assets.
"Most of these tokens just give you no ownership of anything. There's no dividends. There's no cash flows. You know, they got like a price to sales. No one like really what are these things? They're for speculation."
Correct
DeFi was primarily used for speculation, and its absence is not missed, suggesting the market doesn't need it and its underlying numbers are unfavorable.
"I literally used all the DeFi stuff purely for speculation. And now that I don't use it for speculation, I don't miss it at I don't feel like I need the feels. So that's my base is I just don't think the market needs this stuff. And when you run the numbers, the numbers are really ugly."
Incorrect
Obsessively updating a precious metals price spreadsheet multiple times in a day, indicating extreme enthusiasm, is a sign that the top has been reached.
"I have a spreadsheet where I track my gold, silver, platinum prices. And there was that time at the top 4,300 for gold. On that specific day, normally I update that spreadsheet like once a month, once every two weeks, I updated that spreadsheet three times in a day and I immediately said to myself, that's it. We have hit the top."
Pending