Bitcoin’s 50% slide from its October peak reflects temporary capital diversion to artificial intelligence narratives rather than fundamental deterioration in crypto adoption, according to researchers at Charles Schwab and Hashdex.
The digital asset currently trades just below $62,000. Samir Kerbage, Chief Investment Officer at Hashdex, attributes the underperformance to a broader shift in investor attention. “Capital follows attention and narratives,” Kerbage said. “Crypto has benefited from this in the past but right now, attention is elsewhere. AI infrastructure plays, IPO pipelines, macro positioning around rate expectations, are absorbing the flows.”
Despite bitcoin’s price weakness, on-chain activity tells a different story. Stablecoin transaction volume in the first half of 2026 already exceeded all of 2025. Crypto ecosystem transactions reached record highs in the second quarter. Tokenized real-world assets have grown more than 60% year to date. Institutional infrastructure continues expanding across banks, brokers, and payment providers.
Kerbage highlighted this disconnect between price and utility. “The gap between market capitalization and on-chain activity has never been wider,” he said.
Jim Ferraioli, Director of Digital Currencies Research and Strategy at Charles Schwab, frames bitcoin’s current position within a longer historical pattern. “Through enough market lore, the so-called ‘bitcoin halving cycle’ has become a feature of bitcoin,” Ferraioli said. He argues that bitcoin historically requires more than a year after bear market bottoms to reclaim levels above less efficient miners’ production costs, estimated at $95,000.
The average investor’s cost basis sits near $80,000, creating potential selling pressure as bitcoin moves toward that threshold. Ferraioli’s analysis suggests the post-halving recovery pattern remains intact despite expectations that institutional adoption and spot ETFs would permanently alter bitcoin’s historical volatility cycles.
Regulatory tailwinds could accelerate recovery. The U.S. has improved cryptocurrency regulatory clarity, with potential for further strengthening if Congress passes the CLARITY Act. This backdrop of improving infrastructure and regulation contrasts sharply with the narrative of crypto weakness.
Both researchers agree that current price action does not reflect diminished structural demand for digital assets. Instead, they point to cyclical capital flows and historical precedent to explain bitcoin’s recent underperformance relative to record-high equities and AI-focused investment vehicles.
