Bitcoin's BTC/USD recent pullback signals the digital asset is maturing into a more stable market, according to Anthony Pompliano, founder and CEO of Professional Capital Management.

What Happened: "What I think we're watching is a market that's maturing, institutions are coming in, it's getting bigger. And so what you're starting to see is kind of muted volatility," Pompliano told CNBC on Thursday.

"And that means that people who are hoping Bitcoin is gonna go to $400,000, $500,000 in a bull market, this cycle is probably not gonna happen. But also people who think that you're gonna get… 85, 90% drawdowns in the bear markets, that's probably not gonna happen either."

Pompliano noted that Bitcoin's drawdowns in this cycle have been around 10–15%, compared with the 30% pullbacks seen in earlier bull markets.

He said the changing composition of Bitcoin holders, from retail traders to institutions and ETFs, is helping dampen volatility and establishing Bitcoin as a more durable asset.

"Bitcoin has gone from a contrarian trade to consensus trade," he said. "In order to do that, you need it to become less volatile."

He added that institutional investors and public companies are less likely to panic sell, unlike retail traders driven by "fear and greed."

This, he argued, represents a "natural and good sign for Bitcoin in the long run."

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What’s Next: Looking ahead, Pompliano said Bitcoin's current price levels near $112,000–$113,000 appear "pretty oversold," with seasonality and potential Fed policy shifts possibly fueling a rebound in September and October.

"Starting in September, we should see Bitcoin kind of come back alive again," he said.

On the long-term outlook, Pompliano maintained confidence in Bitcoin reaching $1 million but cautioned that it is unlikely to occur this cycle. "Bitcoin will definitely go to a million at some point in the future," he said. "I just think this cycle, it's very unlikely."

While acknowledging that some investors are rotating into Ethereum ETH/USD or stablecoin businesses like Circle CRCL, Pompliano reiterated his stance that "Bitcoin is the king. It's been the king. It's going to remain the king."

He also flagged that some large holders are shifting into ETFs for security reasons, but predicted most in the community will continue to prioritize self-custody, adhering to the principle of "not your keys, not your coins."

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