CryptoQuant asserts "The bear market has arrived"! Bitcoin demand momentum has cooled off, possibly testing the $70,000 level again.

On-Chain Data Analysis Company CryptoQuant Issues Warning: Due to a clear weakening in Bitcoin demand momentum, cryptocurrencies may have entered a bear market, and the subsequent downside risks should not be ignored.

Recently, CryptoQuant released a report stating: “The growth in (Bitcoin) demand has significantly slowed, indicating that the market is entering a bear market. Since 2023, Bitcoin has experienced three waves of spot demand surges, driven by the US spot ETF listing, the US presidential election, and Bitcoin reserve companies.”

However, since early October 2025, this demand growth has fallen below the long-term trend line, indicating that the new buying pressure in this cycle has largely been absorbed by the market, causing Bitcoin to lose a key support level.

Based on the current weakness, CryptoQuant believes that the downside risk for Bitcoin is gradually emerging. “$70,000” is the first important support zone. If the market cannot regain bullish momentum, a further decline to $56,000 cannot be ruled out. The report states:

From historical experience, Bitcoin’s bear market bottom often aligns with the “Realized Price” (reflecting the average cost basis of all holders), which is currently around $56,000.

If this level is truly tested, it would mean Bitcoin has fallen about 55% from its all-time high, potentially making it the bear market with the smallest retracement in history.

The medium-term support level for Bitcoin is around $70,000.

Regarding the timing of market concerns, CryptoQuant’s research director Julio Moreno revealed: “A retracement to $70,000 may occur within the next 3 to 6 months; as for the deeper drop to $56,000, if it happens, it could be in the second half of 2026.”

He further added that this bear market actually began in mid-November this year, following the largest liquidation event in cryptocurrency history on October 10.

3 Major Data Confirm: Capital Is Withdrawing

CryptoQuant listed three key data points supporting the view that “the bear market has arrived”:

1. ETF Turning into Net Seller: In Q4 2025, US Bitcoin spot ETFs shifted to a “net outflow” status, reducing holdings by about 24,000 Bitcoins, contrasting sharply with strong buying activity in the same period last year.

2. Large Holders Shrinking: Addresses holding 100 to 1,000 Bitcoins (including ETFs and institutions) are growing at a rate below trend lines. This deterioration in demand mirrors the situation at the end of 2021, just before the 2022 bear market.

3. Derivatives Cooling Off: The funding rates of perpetual contracts (calculated as a 365-day moving average) have fallen to the lowest point since December 2023. A decline in funding rates usually indicates reduced leverage willingness among bulls, a typical bear market feature. Additionally, the price has broken below the 365-day moving average, which is often viewed as the bull-bear dividing line in technical analysis.

CryptoQuant also presented a provocative view: “The core engine driving Bitcoin’s 4-year cycle is ‘demand cycles,’ not ‘halving events.’” When demand growth peaks and begins to decline, regardless of supply-side dynamics, a bear market often ensues.

It is worth noting that CryptoQuant’s bearish tone sharply contrasts with recent views from Wall Street giants, leading to intense market battles between bulls and bears:

• Citigroup: The baseline scenario predicts Bitcoin will rise to $143,000 in the next 12 months, with the most optimistic scenario reaching $189,000;
• JPMorgan: Based on gold comparison valuation, maintains a target of $170,000 for Bitcoin.
• Standard Chartered: Although becoming more cautious and halving Bitcoin’s 2026 target price, still maintains a $150,000 target.
• Bitwise: Firmly believes Bitcoin will hit a new all-time high again in 2026.

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