Polymarket Warning: 78% chance that Bitcoin falls below $65,000. How should investors respond?

On the prediction platform Polymarket, a compelling betting war is heating up: the odds of Bitcoin falling below $65,000 in 2026 have surged to 78%, attracting millions of dollars in bets. This numerical game acts as a mirror, reflecting the deep currents within the current crypto market—from the frenzy of bullish expectations to the widespread anxiety over a significant correction, the rapid shift in market sentiment is astonishing.

Divergence in Market Predictions

Currently, Bitcoin market forecasts are showing an unusual divergence. Data from Polymarket indicates that there are clear disagreements about Bitcoin’s price trajectory in 2026.

In addition to the high probability of falling below $65,000, there is a 41% chance of betting on Bitcoin dropping to $55,000. Meanwhile, there remains a 71% probability of Bitcoin reaching $100,000 in 2026. This conflicting scenario highlights the enormous uncertainty in the market. Participants in prediction markets are voting with real money, expressing their collective judgment about the future, but these judgments can themselves be influenced by short-term emotions.

Contradictory Institutional Views

Faced with market confusion, the perspectives of major institutions show interesting divergence. On one hand, several institutions, including Standard Chartered, have recently lowered their price forecasts for Bitcoin in 2026. Standard Chartered significantly cut its end-of-2026 price prediction from $300,000 to $150,000, citing slowing ETF fund inflows and weakening corporate Bitcoin purchase demand.

On the other hand, some institutions remain relatively optimistic. For example, Grayscale Investments once predicted Bitcoin could break its all-time high of $126,000 in the first half of 2026, citing ongoing institutional adoption and gradually clarifying regulatory environments. Bernstein analysts also previously set a target price of $150,000 for 2026. Such contradictions among institutional views are not uncommon in the crypto market; they reflect the tension between long-term fundamentals and short-term market dynamics.

Core Concerns in the Market

Why is the market so worried about Bitcoin’s future? Several key factors are collectively influencing current market sentiment.

On the technical side, since Bitcoin broke below its 365-day moving average in November 2025, it has entered a cycle some analysts define as a “bear market.” This long-term moving average is often seen as the “bull-bear dividing line,” and once breached, it can trigger systematic deleveraging among technical traders.

On the macro level, some analysts point out that current concerns mainly stem from liquidity tightening in the overall U.S. financial environment. Changes in the Federal Reserve’s balance sheet, the draining effect of Treasury bond issuance, and other macro factors directly impact Bitcoin’s price through risk asset pricing logic.

Deeper worries come from within the Bitcoin ecosystem itself. Mati Greenspan, CEO of Quantum Economics, states: “Bitcoin’s core design goal is to become a currency independent of the traditional banking system. Price appreciation is just a ‘side effect’ of that, not its purpose.” When the market only focuses on price movements, it may have strayed from its original vision.

Limitations of Prediction Markets

The high probability figures on Polymarket undoubtedly amplify market pessimism, but here’s a key question: do the “probabilities” in prediction markets equal “facts” about the future? The answer is: not necessarily. Prediction markets more accurately reflect the collective sentiment of participants voting with real money in the present. This sentiment can be contagious and self-fulfilling, but it can also reverse instantly due to a sudden positive development. Just like the epic bull market that followed the March 2020 crash, which few could have predicted at the time. Prediction markets are an excellent window into market sentiment but are not a navigation tool for investment.

Additionally, Polymarket itself faces some regulatory challenges, such as restrictions in certain jurisdictions due to licensing issues. This reminds us that this “sentiment barometer” is also in a dynamic environment.

Investor Strategies

In such a divided market environment, how should investors respond? With so much noise, I believe it’s better to focus on a few more substantive indicators rather than being led solely by probability figures. Pay attention to MicroStrategy’s “cost basis” defense: the company holds over 712,647 Bitcoin, with an average purchase price of $76,037 per coin. If Bitcoin remains below its average cost, it could undermine its long-term holding strategy or influence other listed companies’ attitudes to follow suit.

Monitor macro liquidity data: instead of guessing, focus on real data such as the Federal Reserve’s balance sheet, the U.S. Treasury General Account (TGA) balance, and other tangible indicators. These are the “driving forces” behind all risk assets, including cryptocurrencies.

Observe on-chain activity quality: during price declines, are long-term holders panic-selling or calmly accumulating? On-chain data can reveal whether holdings are becoming more dispersed or concentrated. According to Gate’s market data, as of February 5, 2026, Bitcoin’s price is $70,713.5, with a 24-hour change of -6.65%, and a market cap of $1.56 trillion. The current price has already fallen below some major institutions’ average holding costs, intensifying concerns about further declines.

Although prediction markets show a 78% chance of Bitcoin dropping to $65,000 in 2026, data also indicates that bets on Bitcoin rebounding to $100,000 have reached a 71% probability. This contradiction reveals the market’s divided outlook. Polymarket traders are betting with real money that Bitcoin will fall below $65,000 while simultaneously betting on it surpassing $100,000 on the same platform.

When most expect the market to decline, contrarian opportunities may be brewing. From another perspective, the forecast range for Bitcoin in 2026 extends from $75,000 to $225,000, and this staggering disparity fully illustrates the enormous uncertainty in the market.