On February 11, as Bitcoin once again slipped below sixty-six thousand dollars during the Asian trading session and more than two hundred fifty million dollars in leveraged positions were liquidated within twenty-four hours, the vast majority of retail and leveraged traders were being forced out. Perpetual funding rates across exchanges remained negative, and open interest had shrunk by more than half from last October’s peak. These cold statistics point to one fact: the market is not only bearish but undergoing systematic deleveraging. In this atmosphere, Vavilov’s statement appeared strikingly “out of sync.”

As one of the earliest commercial pioneers in Bitcoin mining hardware, Vavilov has spent fifteen years in the industry. He personally witnessed the devastating bear markets of 2018 and 2022 and experienced the full cycle of mining rigs evolving from garage operations to Nasdaq listings. His decision to speak out at this moment was not driven by confidence in a short-term rebound, but by an entirely different framework: asset allocation rather than market timing. As he put it, “For us, Bitcoin’s decline is an opportunity to rebalance the portfolio and buy at lower prices.”

What Is Vavilov’s Objective?

His words on WhatsApp were almost restrained: “rebalance the portfolio,” “buy a certain amount at lower prices,” “just a component of the portfolio.” The phrasing contrasts sharply with the typical evangelical enthusiasm of the crypto world. It sounds more like an institutional investor managing cross-cycle capital, conducting routine quarterly rebalancing when an asset deviates from its target weight.

Vavilov’s recent business positioning clearly reveals his strategic focus. He remains a significant shareholder—around twelve percent—in Nasdaq-listed Cipher Mining. However, the core narrative of that investment is no longer Bitcoin mining but AI data centers. Cipher’s ten-year, multi-billion-dollar agreement with Fluidstack has shifted its anchor from the crypto cycle to AI compute leasing. This suggests that Vavilov’s core interest has moved from “Bitcoin-centric” thinking to being a “compute infrastructure provider.” For him, Bitcoin has evolved from a belief-driven asset into a highly volatile risk exposure correlated with tech equities—one that requires dynamic hedging rather than blind conviction.

This explains why Vavilov’s “dip-buying” remarks received coverage in professional financial media but failed to spark any meaningful reaction in trading activity. Kaiko analyst Laurens Fraussen pointed out a concerning signal: prices declined without a corresponding surge in volume. That may sound counterintuitive—sharp drops usually come with heavy turnover. But a more troubling scenario is a “low-volume grind lower,” which suggests shallow order-book depth and a lack of strong bid support at intermediate price levels. In such an environment, even large “whale” buy orders can easily be absorbed by prevailing pessimism.

Another widely cited valuation framework—the Metcalfe’s Law model—is sending a sobering message. Claude Erb, former commodity portfolio manager at TCW Group, estimates Bitcoin’s fair value at roughly fifty-five thousand dollars based on this model. While the model has limitations—it assumes network value scales with the square of user numbers, even though Bitcoin ownership is highly unevenly distributed—the key point is that the market has begun referencing this figure as a pricing benchmark.

When panic sentiment resonates with what appears to be a rigorous valuation model, prices can become self-fulfilling. At around sixty-six thousand dollars, Bitcoin still trades roughly seventeen percent above the model’s implied fair value.

Vavilov’s Buying Reflects Bitcoin’s Identity Shift

In previous bear cycles, Bitcoin followed a relatively clear transmission chain: “miner capitulation → hash-rate reset → cost bottoming → new capital inflow.” This time, while miner selling pressure remains, the “new capital inflow” stage appears broken. CryptoQuant data show that although the amount of spent Bitcoin has increased, fresh capital inflows have not expanded in tandem. Even more concerning, spot Bitcoin ETFs saw their largest single-day outflows since late last year. Institutional capital has not been stepping in to buy the dip—instead, it has been exiting.

This suggests that the “external rescuers” who helped Bitcoin recover in prior cycles—whether the macro liquidity wave of quantitative easing or ETF-driven capital flows—have yet to return. Vavilov’s purchase is a positive signal, but his framing of Bitcoin as merely “a component of the portfolio” underscores his mental shift from crypto maximalism to cross-asset allocation. He will not leverage up on every decline like Michael Saylor, nor act as a last-resort buyer like Grayscale once did.

Vavilov’s cautious buy order does not answer the question of when Bitcoin will bottom. But it answers a more important one: when Bitcoin falls to a certain level, is there still someone willing to step in and take the other side?