What does John 13:37 mean?

When Jesus was washing the feet of the disciples (John 13:5), He explicitly said that what He was doing would not be understood at first (John 13:7). That didn't stop Peter from insisting that, since he didn't understand, he wouldn't cooperate (John 13:8). Peter meant well, but this chapter contains yet another example of his bravado and emotions getting the best of him. Jesus corrected Peter's first incident with stern reassurance (John 13:8–10). Here, however, Peter makes a remark which he probably regretted for the rest of his life.

Scripture gives no reason to think Peter's words are a bluff. He fully believes what he is saying. This is not an attempt to look good, or a fear-covering lie. To Peter's credit, he will launch himself into battle when Jesus is first arrested later this evening (John 18:10). But when faced with true danger, Peter will give in to fear. As Jesus is about to predict, that means even denying he knows Jesus, let alone being willing die with Him (John 13:38).

An additional wrinkle to this exchange is that Judas has already left (John 13:30). The disciples, at this point, do not know that Judas is the betrayer—all they know is that one of the inner circle is a liar (John 13:21). When Jesus gives His prophecy in the next verse, it's all but certain that some of them thought Peter would be the culprit.