These Indicators Suggest Bitcoin May Be at the Start of a Bear Market: CryptoQuant
Analysts from crypto market intelligence firm CryptoQuant have raised alarms regarding the current state of Bitcoin (BTC), suggesting the leading cryptocurrency could be entering a bear market. Their recent report highlights concerning trends in on-chain valuation metrics that indicate a significant shift in market dynamics.
The assessment of Bitcoin’s price movement suggests that the recent correction is consistent with historical patterns; however, the overall metrics currently indicate a more severe state than typically experienced during previous bull runs. The combination of these valuation metrics implies that Bitcoin may be at deep low levels or possibly entering further corrective territory.
### BTC in Bearish Territory?
CryptoQuant’s analysis points to a distinct bearish trend within the market. Key indicators, such as the Bitcoin Bull-Bear Market Cycle Indicator, have reached their most negative thresholds observed in this cycle. Additionally, the Market Value to Realized Value (MVRV) Ratio Z-score has fallen below its 365-day moving average, a signal commonly associated with weakening price momentum.
Historically, when both the MVRV Ratio and the Bull-Bear Market Cycle Indicator drop to their present levels, Bitcoin has either experienced a sharp correction or has been on the precipice of a bear market. Demand dynamics are also troubling. Current metrics indicate that Bitcoin’s demand remains in contraction territory, with significant reductions in accumulation by large investors, or “whales”. Recent trends have demonstrated that Bitcoin’s apparent demand has decreased at an alarming rate, plummeting by 103,000 BTC—the sharpest decline since July 2024.
### BTC Could Fall to $63K
Further complicating the outlook for Bitcoin is the behavior of U.S.-based spot Bitcoin exchange-traded funds (ETFs). These funds have now turned into net sellers of BTC, contrasting sharply with their accumulation activities during the same period last year. In 2024, these ETFs collectively purchased approximately $8.7 billion worth of Bitcoin, but year-to-date, their cumulative purchases have dwindled to about $0.7 billion. This shift places additional downward pressure on Bitcoin’s price.
Additionally, there has been a notable decline in the volume of Bitcoin moving onto major exchanges like Coinbase from other platforms, falling below the 90-day moving average. The Inter-exchange Flow Pulse metric from CryptoQuant has indicated an ongoing price correction since February 13, a time when Bitcoin was trading near $96,000. Typically, significant inflows to Coinbase signify strong market demand, but the current trends suggest the opposite.
CryptoQuant analysts are cautioning that if Bitcoin fails to maintain support levels between $75,000 and $78,000, it could witness a plummet to around $63,000. At current prices hovering around $82,000, this projection represents a critical threshold related to on-chain realized price metrics. Such a decline could mark a significant turning point in Bitcoin’s price trajectory, prompting further scrutiny from investors and analysts alike.
