Bitcoin continued its new year climb over the weekend to its highest level since mid-August. However, there are probably a few more bumps to endure before investors are out of this crypto winter. That’s one observation about the current crypto bounce Bernstein analysts made in a note to investors Monday. They called it a mean-reversion rally, meaning that they see bitcoin prices reverting to their long-term mean or average level. “We reckon, the mean reversion of crypto still has some headroom,” analyst Gautam Chhugani said in the note. “Bitcoin in their entire 14-year history has never had two consecutive years of negative returns. So we would be cautious to be bearish here. But is this the start of a new sustained rally? Unlikely.” Bitcoin touched $23,333.83 on Saturday, according to Coin Metrics. That was its highest level since Aug. 19 – after much of the damage from the demise of Terra and the bankruptcies of Three Arrows Capital , Celsius and Voyager , but before Federal Reserve Chair Jerome Powell’s speech in Jackson Hole and the collapse of FTX . After finishing 2022 down more than 60%, bitcoin has already risen 39% year to date. Ether is up almost 36%. BTC.CM= 6M mountain Bitcoin Nevertheless, Chhugani attributed the recent bounce to capital already within the crypto industry, namely “sidelined stablecoins” being deployed. He said there haven’t been “any new capital allocations to sustain this rally.” Furthermore, the market “lacks a clear innovation theme” to attract new capital, although there are some contenders, the analyst added. “DeFi could start growing with real world assets integration or NFT gaming teams could start delivering the early alpha versions of their video games,” Chhugani said. “We would wait to see which innovation themes drive a new cycle, but we would continue to urge caution to the bears, to not carry the 2022 pessimism too far.” As the crypto asset class becomes “more regulated,” Chhugani expects to see institutions take crypto positions this year, he said. More positive regulatory developments in Hong Kong could give comfort to institutional investors, the analyst added. – CNBC’s Michael Bloom contributed to this story.