Bitcoin Enters Bear Market as Demand Wanes, CryptoQuant

Generally, Bitcoin’s recent market trends are showing signs of demand exhaustion, which could indicate a move into bear market territory, according to a report by CryptoQuant. Often, demand growth has slowed significantly since early October 2025, falling below the long-term trend, and this is a major concern for investors. Normally, Bitcoin has experienced several rallies driven by demand, but the foundations supporting these price increases are now weakening. Usually, the market is driven by demand, and when demand decreases, the market suffers.

Bitcoin Enters Bear Market

Always, the introduction of new products, such as U.S. spot Bitcoin ETFs, has contributed to demand waves, but with these catalysts already factored into the market, additional demand has decreased. Naturally, this removes a crucial support for prices, and the market is expected to decline. Mostly, positive sentiment around the U.S. presidential election has also contributed to the demand waves, but this sentiment is now fading.

Weakening Foundations

Obviously, the weakening foundations of the Bitcoin market are a major concern for investors, and the demand growth has slowed significantly since early October 2025. Typically, the market is driven by demand, and when demand decreases, the market suffers, so investors should be careful. Always, it is important to keep an eye on the market trends and adjust investment strategies accordingly. Normally, the market is volatile, and investors should be prepared for any eventuality.
Generally, three major factors contributed to the demand waves: the introduction of U.S. spot Bitcoin ETFs, positive sentiment around the U.S. presidential election, and increased interest from Bitcoin treasury companies. Usually, these factors contribute to demand, but now they are fading, and the market is expected to decline. Naturally, the market is driven by demand, and when demand decreases, the market suffers.

Key Drivers Behind Past Rallies

Normally, the market is driven by demand, and when demand increases, the market grows, but now the demand is decreasing, and the market is expected to decline. Often, the introduction of new products, such as U.S. spot Bitcoin ETFs, has contributed to demand waves, but with these catalysts already factored into the market, additional demand has decreased. Usually, this removes a crucial support for prices, and the market is expected to decline. Mostly, the market is volatile, and investors should be prepared for any eventuality.

Institutional Influence

Always, institutional investors are also contributing to the bearish sentiment, and U.S. spot Bitcoin ETFs have shifted from net accumulation to net distribution in the fourth quarter of 2025, with a decline of approximately 24,000 BTC in net holdings. Naturally, on-chain data reveals that addresses holding between 100 and 1,000 BTC are growing at a rate below the historical trend, a pattern similar to late 2021 before the 2022 bear market. Generally, the market is driven by demand, and when demand decreases, the market suffers.

Derivatives Market Signals

Obviously, derivatives market data further confirms the weakening risk appetite, and funding rates in perpetual futures have dropped to their lowest level since December 2023, suggesting a decreased willingness among traders to hold leveraged long positions. Typically, the market is volatile, and investors should be prepared for any eventuality. Always, it is important to keep an eye on the market trends and adjust investment strategies accordingly. Normally, the market is driven by demand, and when demand decreases, the market suffers.

Technical Outlook

Generally, from a technical standpoint, Bitcoin has fallen below its 365-day moving average, a key indicator that historically separates bull and bear market conditions. Usually, this is a sign of a bear market, and investors should be careful. Naturally, the market is driven by demand, and when demand decreases, the market suffers. Mostly, the market is volatile, and investors should be prepared for any eventuality.

Potential Downside

Always, despite the bearish shift, the potential downside may be relatively limited, and past bear-market bottoms have aligned with Bitcoin’s realized price, currently near $56,000, implying a drawdown of roughly 55 % from the recent all-time high. Normally, interim support is expected around the $70,000 level, and investors should keep an eye on this level. Obviously, the market is driven by demand, and when demand decreases, the market suffers.

Conclusion

Generally, while Bitcoin’s market cycle shows clear signs of demand exhaustion and a shift into bear market territory, the potential downside may be less severe than in previous cycles, so investors should keep an eye on key support levels as the market continues to reset. Usually, the market is volatile, and investors should be prepared for any eventuality. Always, it is important to keep an eye on the market trends and adjust investment strategies accordingly. Normally, the market is driven by demand, and when demand decreases, the market suffers.