The on-chain analytics company CryptoQuant announced that the Bitcoin bear market has already begun, citing demand weakness as a key signal. The report sees price risks declining towards the $70,000 level in the coming months, with the possibility of reaching $56,000 if the downward trend continues.
### Main Reasons for the Bearish Outlook
The CryptoQuant analysis relies on several on-chain indicators that point to demand exhaustion after three strong buying waves in 2025:
- Declining demand growth: Demand growth has decreased from the long-term trend since early October 2025, indicating a continuation of potential downward pressure on the price.
- Shift in U.S. spot ETF: Bitcoin ETFs have shifted from net buyers to net sellers in the fourth quarter of 2025, with their holdings decreasing by about 24,000 Bitcoin. This is in stark contrast to the fourth quarter of 2024, where ETFs were a major driver of market strength.
- Institutional wallet growth below trend: Addresses holding between 100 and 1,000 Bitcoin (often associated with ETFs and treasury companies) have grown at a rate lower than the historical trend, similar to what happened at the end of 2021 before the bear market in 2022.
The head of research at CryptoQuant, Julio Moreno, confirmed that the bear market officially began around mid-November, following the largest liquidation event in cryptocurrency history on October 10. Since then, demand weakness has continued.
### Price Predictions
- Key risks: A decline towards $70,000 in the coming months.
- Most bearish scenario: The price could reach $56,000 if it fails to regain momentum.
- General description: The report describes that bearish support points indicate a "relatively shallow bear market," meaning that the decline may not be as severe as in previous cycles, but it remains bearish.
### The Broader Context of the Bitcoin Cycle
CryptoQuant emphasizes that the four-year Bitcoin cycle is primarily driven by expansions and contractions in demand, not by the halving itself. After the three demand waves in 2025 (driven by ETFs, political optimism, and treasury companies), it appears that the latest wave is collapsing, indicating a transition to a bearish phase.
### Key Takeaway
The CryptoQuant report warns that institutional demand weakness and a shift in ETF flows are pushing Bitcoin toward a sustained bear market, with notable downside risks in the coming months. Although the bear market may be "shallow," on-chain signals indicate a need to regain demand momentum to avoid further losses.
