Data analytics firm CryptoQuant suggests that Bitcoin may have entered a bear market as early as November 2025. Citing slowing demand and persistent on-chain weakness, the institution forecasts a potential price bottom between $56,000 and $60,000 sometime in 2026.
Julio Moreno, Research Director at CryptoQuant, issued a stark warning, indicating Bitcoin could already be two months into a bear cycle. In a recent analysis, Moreno outlined this bearish outlook, referencing the company’s proprietary “Bull Score Index.” This comprehensive indicator, which synthesizes technical and on-chain data, turned distinctly negative in November and has since failed to recover. Key triggers identified include Bitcoin’s breach of its one-year moving average, a noticeable decline in network activity, shrinking trading volumes, and significant liquidation events in October that sapped buying momentum.
Demand Exhaustion, Not Halving-Related Supply Factors
The projected price floor aligns closely with Bitcoin’s “realized price,” which represents the average cost at which current holders acquired their coins, currently hovering around $56,000. Historically, this metric has often marked the nadir of bear markets. A descent to this range would signify an approximate 55% retracement from the October 2025 all-time high of over $126,000. Moreno points out that this would represent one of Bitcoin’s mildest corrections in history, considerably less severe than the 70% to 80% declines observed in previous cycles.
Moreno attributes this market shift primarily to exhausted demand rather than supply-side factors like halving events. He highlighted three major waves of demand throughout 2025: the launch of US spot ETFs, the presidential election, and the emergence of Bitcoin savings strategy companies. Since early October, however, demand growth has fallen below trend levels, institutional positions are being unwound, and profit indicators have stagnated.
Bitcoin peaked at $126,080 in October 2025, having started that year around $93,000. However, it has since fallen below its early-year levels, reflecting diminished demand from ETFs and whales. As of early 2026, the price hovers near $88,500, prompting Moreno’s prediction of a bear market bottom within the $56,000 to $60,000 range over the coming year.
This anticipated 55% drop from its historical peak is considered more moderate compared to the sharp crashes of past cycles, such as in 2022. Moreno attributes this downturn to weakening spot demand, noting that US Bitcoin ETFs transitioned into net sellers during Q4 2025, offloading approximately 24,000 Bitcoins, a stark contrast to their active accumulation in the preceding year.
Potential Retracement to $70,000 Within 3-6 Months
A significant reduction in buying volume from institutional strategies has further eroded key bullish pillars. Consequently, these firms have established substantial reserves, totaling $1.44 billion, to navigate prolonged periods of sideways trading or further declines.
Despite the somber outlook, Moreno views this as a relatively moderate correction, advising long-term holders against panic selling. Broader market signals, including the “Bear Score Index” hitting zero for the first time since 2022, reinforce the bearish inclination, contingent on the absence of new macro liquidity injections, such as Federal Reserve rate cuts. Analysts note that Bitcoin’s annual loss in 2025 marks its first since 2022, posing a challenge to hopes for a 2026 rebound and underscoring the risks if momentum fails to recover promptly.
Based on the current weak sentiment, CryptoQuant believes that Bitcoin’s downside risk is gradually emerging. The $70,000 mark is identified as the first critical support zone. Should the market fail to regain bullish momentum, a further decline to $56,000 is not ruled out. Regarding specific timelines, Moreno revealed: “A retracement to $70,000 could occur within the next 3 to 6 months; as for a deeper drop to $56,000, if it materializes, it would likely fall in the second half of 2026.”
Looking ahead, a potential rebound may hinge on a resurgence of institutional buying or an uplift in global liquidity. However, CryptoQuant emphasizes that the current market structure bears similarities to the setup observed before the 2022 crash. Investors should prepare for continued volatility, with $70,000 serving as an initial downside target, followed by the deeper support of the predicted bottom.
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