#美联储重启降息步伐 Core Judgment: The Bitcoin bull market will continue in 2025, but it is undergoing a deep mid-term correction. The bottom of the correction is expected to be in the range of $80,000 to $90,000, and it is expected to return to $120,000 to $150,000 by the end of 2025.
Based on the latest market data and multi-dimensional analysis, we believe that Bitcoin is currently in the mid-term correction phase of a post-halving bull market cycle, rather than the end of the bull market. Although the price has corrected by more than 30% from its all-time high of $126,198 on October 6th, on-chain data shows that long-term holders have not engaged in large-scale selling, and while institutional funds have fluctuated, they are still flowing in overall. The US government's strategic reserve policy has provided new demand support for the market. We expect this correction to find significant support at $95,000-$100,000. With the Fed's monetary policy shift and escalating geopolitical risks, Bitcoin's safe-haven attributes as "digital gold" will once again become prominent.
1. Market Status: Deep Correction from Historical Highs
1.1 Price Trend Analysis
Bitcoin reached a historic high of $126,198 on October 6, 2025, before entering a deep correction. According to the latest market data, as of December 21, 2025, Bitcoin prices have been oscillating in the range of $95,000 - $113,000, with slight differences in data from different trading platforms: CoinMarketCap shows $119,029, a 24-hour increase of 2.14%; Kraken shows $95,172, a 24-hour decrease of 0.68%; CoinGecko shows $113,316, a 24-hour increase of 0.3%; TradingView shows $113,393, a 24-hour decrease of 0.07%.
From a technical analysis perspective, Bitcoin has broken through multiple key technical levels. The daily chart has formed a 'death cross', with the 50-day moving average crossing below the 200-day moving average, entering a technically bearish area. The RSI indicator is in the oversold range (<30), indicating that short-term selling pressure has been released but has not yet stabilized. More critically, Bitcoin has dropped below the 365-day moving average, which is a significant watershed in distinguishing bull and bear markets historically.
1.2 Analysis of the Characteristics of This Round of Adjustment
Compared to historical bear markets, this round of adjustment exhibits clear characteristics of a 'mid-term correction'. Historically, the largest drawdowns in Bitcoin bear markets have exceeded 78%, with declines of 84% in the 2013-2015 bear market, 84% in the 2017-2018 bear market, and 78% in the 2021-2022 bear market. Currently, the pullback from historical highs is only 30-35%, far from the bear market threshold.
From a timing perspective, Bitcoin will complete its fourth halving in April 2024. According to historical patterns, bull market peaks typically occur 12-18 months after halving. Currently (approximately 20 months post-halving), it remains within a reasonable range of historical cycles, and some analysts believe this bull market may extend into the end of 2025 or early 2026.
From the driving factors of the adjustment, this round of decline is mainly affected by three aspects: first, changes in expectations for Federal Reserve monetary policy, with market expectations for rate cuts in 2025 reduced from 4 to 2; second, uncertainties regarding geopolitical risks, including the ongoing situation in the Middle East and the Russia-Ukraine conflict; third, a concentrated outflow of profit-taking, especially from some early holders.
2. On-chain Data: Divergence of Long-Term Holder Attitudes
2.1 Exchange Balance Change Trends
On-chain data shows that the Bitcoin exchange balance has experienced a phase of recovery after a long decline. From November 2024 to May 2025, the Bitcoin holdings of centralized exchanges decreased by nearly 668,000 BTC. However, starting in July, the exchange balance began to recover from a low of 540,000 BTC and is currently stable at around 569,000 BTC.
This change reflects the complex mentality of market participants. On one hand, long-term holders are still withdrawing Bitcoin from exchanges, demonstrating a firm belief in 'HODLing'; on the other hand, some investors are beginning to redeposit Bitcoin into exchanges, possibly to sell promptly during price rebounds or to wait for better buying opportunities.
Notably, Tether increased its Bitcoin reserves during the market decline, transferring approximately $1 billion from Bitfinex's hot wallet to its Bitcoin reserve wallet through two large transactions, raising its reserve holdings to 87,296 BTC, making it the sixth-largest holder of Bitcoin globally. This 'buying the dip' behavior provides an important support signal for the market.
2.2 Analysis of Long-Term Holder Behavior
The behavior of long-term holders (investors holding for more than 155 days) is a key indicator for judging whether a bull market has ended. According to Glassnode data, the supply from long-term holders continues to rise during price increases, indicating a strong willingness to 'HODL'.
However, starting from mid-October, a subtle change occurred. Approximately 62,000 BTC were transferred from long-term inactive wallets, marking the first significant drop since the second half of 2025. More importantly, according to CryptoQuant data, long-term holders sold about 815,000 BTC in the past 30 days, reaching the highest level since January 2024.
This behavior pattern reflects the internal divergence within the long-term holder group. Some early investors (3-5 years ago) chose to take profits when prices reached historical highs, but this was more due to portfolio rebalancing considerations than a loss of confidence in the market. Notably, during the price decline, long-term holders continue to actively increase their positions, as shown by the purple bars indicating significant increases in holdings during price corrections.
2.3 Surrender Behavior of Short-Term Holders
The behavior of short-term holders (investors holding for less than 155 days) shows a clear tendency for 'panic selling'. According to the latest data from CryptoQuant, Bitcoin is entering one of the most severe short-term capitulation phases of the current cycle, with short-term holders realizing losses at a scale usually seen only near major market turning points.
The spent output profit ratio (SOPR) of short-term holders has remained below 1, indicating that they are selling at a loss. This large-scale capitulation behavior typically signals that the market is approaching a bottom. Historical experience shows that when short-term holders sell at a massive loss, it often represents the most pessimistic moment in market sentiment and is a good opportunity for long-term investors to position themselves.
2.4 Changes in Miner Behavior
Miner behavior has a significant impact on Bitcoin prices, as they are the original supplier of Bitcoin. According to on-chain data, 'realized Bitcoin miner inflows to exchanges' surged from $254 million on June 24 to $1.87 billion on August 13, indicating the selling pressure from miners at market highs.
However, the latest data shows a positive shift in miner behavior. According to on-chain analysis, miners have shifted from 'dumping' to 'HODLing'. When miners stop selling during price weakness, the market typically experiences reduced natural selling pressure, helping to mitigate the risk of further forced supply impacting the market.
The change in miner behavior may be related to Bitcoin mining difficulty adjustments and changes in mining revenue. As Bitcoin prices decline, some less efficient miners may be forced to exit, but surviving miners generally have a lower cost basis and tend to hold onto Bitcoin rather than selling immediately.
3. Institutional Capital: The Game of Inflows and Outflows
3.1 ETF Capital Flow Analysis
The capital flows of Bitcoin ETFs directly reflect the attitudes of institutional investors. In November 2025, U.S. Bitcoin ETFs experienced dramatic capital fluctuations. In mid-November, U.S. spot Bitcoin ETFs saw a record outflow of $523 million in a single day, the highest level since their launch in January 2024, pushing total outflows in November to an unprecedented $2.6 billion.
This massive outflow is mainly influenced by two factors: first, the uncertainty of the Federal Reserve's monetary policy, with market expectations for a rate cut in December dropping from 90% to 69%; second, the partial government shutdown in the U.S. resulting in data blackout, complicating Fed decision-making and increasing market uncertainty.
However, the trend of capital outflows reversed at the end of November. On November 21, Bitcoin ETF experienced a net inflow of $238.4 million, with Fidelity's FBTC contributing $108 million and Grayscale Bitcoin Trust contributing $84 million. This 'V-shaped reversal' indicates that institutional investor confidence is recovering.
3.2 Changes in Large Institutional Holdings
Despite overall capital outflows from ETFs, some large institutions are still increasing their holdings in Bitcoin ETFs against the trend. JPMorgan increased its holdings in BlackRock's Bitcoin ETF (IBIT) by 64% in the third quarter of 2025, holding 5,284,190 shares as of September 30. Harvard Management Company has also expanded its IBIT holdings by 257% to $442.8 million, making Bitcoin ETF its largest holding.
The size of BlackRock's Bitcoin ETF (IBIT) continues to grow. As of October 2025, IBIT holds over 800,000 Bitcoins, valued at approximately $98 billion, with an increase of $4 billion inflows this week, currently moving towards a target asset size of $100 billion. IBIT currently holds 55% of all U.S. spot Bitcoin ETFs, demonstrating its dominance in the institutional market.
3.3 Allocation Trends of Pension Funds
It is noteworthy that an increasing number of pension funds are beginning to include Bitcoin in their portfolios. The Wisconsin Investment Board holds over 6 million shares of BlackRock's iShares Bitcoin Trust, valued at approximately $387.3 million, making it one of the largest state pension fund Bitcoin allocations. This allocation from traditional institutional investors provides a long-term stable funding source for the Bitcoin market.
The attitude of institutional investors towards Bitcoin is undergoing a fundamental change. From initially waiting and observing to tentative buying, and now to strategic allocation, it reflects that Bitcoin is being integrated into mainstream investment portfolios. Particularly against the backdrop of increasing global economic uncertainty and declining traditional asset yields, the allocation value of Bitcoin as an alternative asset is becoming increasingly prominent.
3.4 Regional Divergence in Capital Flows
From the perspective of global capital flows, different regions show significant divergence. The U.S. market has experienced noticeable capital outflows due to the impact of Federal Reserve policies and regulatory uncertainties; whereas the Asian market, particularly China and Japan, has relatively stable investor sentiment, with funds still entering at lower levels.
The European market, on the other hand, is showing a cautiously optimistic attitude. The Finance Minister of Luxembourg announced that the national fund will allocate 1% of its portfolio specifically to Bitcoin, marking the first public announcement of Bitcoin allocation by a European sovereign wealth fund, which has significant demonstration significance.
4. Macroeconomic Environment: Policy Shift and Geopolitical Risks
4.1 Impact of Federal Reserve Monetary Policy
The Federal Reserve's monetary policy is one of the most important macro factors affecting Bitcoin prices. The FOMC meeting on December 11, 2025, resulted in a vote of 11 to 1 to lower the benchmark interest rate by 25 basis points to 4.25% - 4.50%, in line with market expectations. However, the signals released during the meeting were clearly hawkish, with the dot plot showing a significant reduction in the expected rate cut from 100 basis points to 50 basis points, indicating a decrease in the expected number of rate cuts from 4 to 2.
Federal Reserve Chair Powell stated at a press conference that the restrictive nature of monetary policy has clearly weakened, but further rate cuts will only come after seeing new progress against inflation. He remains optimistic about the current state and momentum of the U.S. economy and mentioned that the Fed has started to consider the impact of the next government's tariff policies. This cautious statement reflects the Fed's dilemma between inflationary pressures and economic growth.
Significant adjustments have also occurred in interest rate expectations for 2025. The Federal Reserve has raised the median forecast for the 2025 policy rate from 3.4% to 3.9%, the 2026 rate center from 2.875% to 3.375%, and the 2027 rate center from 2.875% to 3.125%. At the same time, the long-term policy rate's estimated median (neutral rate) has been slightly raised from 2.9% to 3%.
This hawkish shift has had a direct impact on the Bitcoin market. Following the Federal Reserve meeting, U.S. stocks, bonds, and gold all declined simultaneously, with the S&P 500, Nasdaq 100, and Dow Jones dropping 2.95%, 3.56%, and 2.58%, respectively; the VIX fear index surged; and COMEX gold fell below 2600 points during the session. As a risk asset, Bitcoin also faced selling pressure.
4.2 The U.S. government's strategic reserve policy
The Trump administration's attitude towards Bitcoin has undergone a fundamental change, shifting from skepticism to strong support. On March 6, 2025, President Trump signed an executive order establishing a strategic Bitcoin reserve and digital asset inventory for the U.S. This policy is milestone, marking the official recognition of Bitcoin as a strategic national asset by the U.S. government.
According to the order, the U.S. Treasury will establish a dedicated office to manage and safeguard Bitcoin and other digital assets seized as part of criminal or civil proceedings or as penalties imposed by administrative agencies. The order also instructs the Treasury Secretary and the Commerce Secretary to develop strategies for acquiring additional digital assets, provided these strategies are budget-neutral and do not impose incremental costs on U.S. taxpayers.
More aggressively, the 'Bitcoin Act' currently under review in Congress goes further by allowing the Treasury to directly purchase 1 million Bitcoins, accounting for about 5% of the total Bitcoin supply, 'on a scale and scope similar to' the gold reserves held by the federal government. Based on the price of March 15, 2025, the value of 5% of the Bitcoin supply is approximately $88 billion.
On July 18, 2025, President Trump signed the GENIUS Act, a historic piece of legislation that will pave the way for the U.S. to lead the global digital currency revolution. This act establishes the first federal regulatory framework for stablecoins, requiring 100% reserve backing, using liquid assets such as dollars or short-term treasuries, and mandates issuers to disclose reserve composition monthly.
4.3 Geopolitical risks are increasing
The escalating geopolitical tensions provide new support for Bitcoin's hedging properties as 'digital gold'. Ongoing conflicts in the Middle East, the protracted Russia-Ukraine war, and uncertainties in relations between the U.S. and major powers like China all increase risks in the global financial system.
Against the backdrop of high prices for traditional safe-haven assets (such as gold), Bitcoin as a decentralized digital asset is increasingly recognized for its hedging value. Particularly in countries facing financial sanctions, Bitcoin offers a means of value storage and transfer that is not controlled by governments.
4.4 Changes in Global Liquidity Environment
The divergence in monetary policies among major global central banks also creates complex effects on the Bitcoin market. The Federal Reserve's hawkish turn contrasts with the accommodative policies of other central banks, and this policy divergence exacerbates uncertainties in exchange rates and capital flows.
The European Central Bank and the Bank of Japan are still maintaining relatively loose monetary policies, providing some support for global liquidity. At the same time, emerging market countries are seeking diversified reserve assets to cope with inflationary pressures and currency devaluation, with Bitcoin naturally becoming one of the choices.
5. Technical Analysis: Key Support and Resistance Levels
5.1 Price Technical Pattern Analysis
From a technical analysis perspective, Bitcoin has formed an important support zone in the $95,000 - $100,000 range after breaking below $100,000. According to UTXO age distribution analysis, the cost basis of holders aged 1 week to 1 month and 1 to 3 months is concentrated around $95,000, providing strong support for the price.
The daily chart shows that Bitcoin has formed a clear double bottom pattern near $95,000, which is a positive technical signal. Meanwhile, the RSI indicator has entered the oversold area, indicating that short-term selling pressure has been fully released. If Bitcoin can effectively break through the resistance level of $105,000, it will open up further upside potential.
From a longer-term technical perspective, Bitcoin remains within the upward channel since April 2024. Despite undergoing a deep adjustment, the lower boundary support of the upward channel remains effective. This suggests that this round of adjustment is more like a technical pullback in a bull market rather than a trend reversal.
5.2 On-chain Technical Indicators
On-chain data provides more signals about the market bottom. According to Glassnode data, the realized market cap broke through the $1 trillion mark for the first time on August 21, 2025, with 25% of the value added in 2025 alone. The continuous growth in realized market cap indicates that the cost for new entrants to the market is relatively high, providing important support for the price.
The MVRV (Market Value to Realized Value Ratio) indicator shows that Bitcoin is currently below its historical average, indicating that the market has entered a relatively undervalued area. Historical experience suggests that when the MVRV indicator is in negative territory, it is often a good time to buy.
6. Future Outlook: Three Possible Scenarios
6.1 Scenario 1: Restarting an Upward Trend After Deep Adjustment (Probability 60%)
In this scenario, Bitcoin will form a solid bottom in the $95,000 - $100,000 range, followed by a new round of upward trend. Factors supporting this scenario include:
First, on-chain data shows that long-term holders are still buying the dip, with their average cost far below the current price, providing strong buying support for the market. Secondly, the U.S. government's strategic reserve policy provides a new source of demand for Bitcoin, with a potential purchase volume of 1 million Bitcoins equivalent to 5% of the current market supply. Thirdly, as the Federal Reserve's monetary policy may turn more accommodative in the second half of 2025, the improvement in liquidity conditions will push up the prices of risk assets.
In this scenario, Bitcoin is expected to rise above $120,000 again before the end of 2025 and challenge new highs of $150,000 - $200,000 in 2026. Key catalysts include: renewed expectations for Fed rate cuts, further escalation of geopolitical risks, and sustained demand from institutional investors.
6.2 Scenario 2: Long-Term Oscillation to Build a Bottom (Probability 30%)
In this scenario, Bitcoin will undergo long-term oscillation in the $80,000 - $120,000 range, potentially lasting 6-12 months. This horizontal consolidation pattern reflects a temporary balance of market bullish and bearish forces.
Factors supporting this scenario include: the uncertainty of the Federal Reserve's monetary policy, concerns about slowing global economic growth, and potential changes in regulatory policies. In this environment, investors will adopt a more cautious attitude, and market volatility will remain high.
In this scenario, Bitcoin will present a range-bound pattern, with resistance at $115,000 and support at $85,000. Investors can engage in high sell-low buy operations within this range while waiting for the market direction to be confirmed.
6.3 Scenario 3: Confirmation of Bear Market (Probability 10%)
In this scenario, Bitcoin will break below the critical support level of $80,000 and may further decline to the $60,000 - $70,000 range. This will confirm the end of the current bull market, and the market will enter a bear market cycle.
Factors triggering this scenario may include: a worsening global economic recession, the outbreak of financial system risks, and significant negative regulatory policies. Particularly, if the U.S. government's strategic reserve policy experiences fluctuations, or if major countries impose stringent regulations on Bitcoin, it could trigger panic selling in the market.
However, we believe that the probability of this scenario is relatively low, mainly due to: the fundamentals of Bitcoin remain strong, adoption rates continue to grow; institutional investor participation is increasing, providing stable demand for the market; technological innovations (such as the Lightning Network) are enhancing Bitcoin's usability; and structural issues in the global monetary system provide long-term support for Bitcoin.
7. Investment Recommendations and Risk Warnings
7.1 Investment Strategy Recommendations
Based on the above analysis, we hold a cautiously optimistic view on the Bitcoin market and recommend that investors adopt the following strategies:
For long-term investors: The current price level offers a good opportunity to build positions. It is recommended to buy in batches in the $85,000 - $95,000 range, with each purchase not exceeding 20% of the planned position. If the price further declines to the $80,000 - $85,000 range, the buying intensity can be increased. The target price is set at $150,000 - $200,000, with a holding period of at least 1-2 years.
For short-term traders: It is recommended to wait for clear bottom signals before entering the market. Focus on the following indicators: daily candlestick forming a long lower shadow, volume significantly increasing at low levels, RSI indicator recovering from the oversold area, and on-chain data showing that long-term holders have started to accumulate again. After confirming the bottom, purchases can be made in the $100,000 - $110,000 range, targeting $120,000 - $130,000.
Follow Chen Ge to avoid getting lost, like and comment to increase wealth!
