CryptoQuant: Bear market may have started, with mid-term support expected at $70,000

PANews, December 20 – According to an article by on-chain analytics firm CryptoQuant, Bitcoin demand growth has significantly slowed, signaling the imminent arrival of a bear market. Since 2023, Bitcoin has experienced three major spot demand waves—driven respectively by the launch of US spot ETFs, the results of the US presidential election, and the Bitcoin treasury company bubble—but since early October 2025, demand growth has fallen below trend levels. This indicates that most of the new demand in this cycle has already been realized, and the key pillar supporting prices has disappeared.

Demand from institutions and large holders is currently contracting rather than expanding: US spot Bitcoin ETFs turned net sellers in Q4 2025, with holdings decreasing by 24,000 Bitcoin, in stark contrast to the strong accumulation in Q4 2024. Similarly, the growth of addresses holding 100 to 1,000 Bitcoin (representing ETFs and treasury companies) is also below trend levels, echoing the demand deterioration trend seen at the end of 2021 before the 2022 bear market.

The derivatives market confirms a weakening risk appetite: the funding rate for perpetual futures (365-day moving average) has dropped to its lowest level since December 2023. Historically, such a decline reflects a reduced willingness to maintain long positions, a pattern typically seen in bear markets rather than bull markets.

Price structure has deteriorated alongside weak demand: Bitcoin has fallen below its 365-day moving average, a key long-term technical support level that has historically marked the boundary between bull and bear markets.

Demand cycles, not halving events, drive Bitcoin’s four-year cycle: The current downturn further indicates that Bitcoin’s cyclical behavior is primarily governed by the expansion and contraction of demand growth, rather than the halving event itself or past price performance. When demand growth peaks and begins to decline, a bear market often follows regardless of supply-side dynamics.

Downside reference points suggest a relatively mild bear market: Historically, Bitcoin bear market bottoms have coincided with the realized price, currently near $56,000, implying that the pullback from recent historical highs could reach 55%—the smallest drawdown ever. The medium-term support level is expected to be around $70,000.