Bitcoin Faces Bear Market Signs Due to Weak Demand
Current on-chain indicators are hinting that Bitcoin might be slipping into another bear market. Observations around reduced institutional investment and tighter liquidity conditions are raising concerns about potential structural downsides.
According to CryptoQuant’s latest Crypto Weekly Report, various on-chain signals are aligning with a bear market scenario. The report highlighted that Bitcoin reached a nearly $126,000 peak in early October, with a Bull Score Index hitting 80, which typically reflects a robust bullish climate.
Interestingly, this bear phase appears to be starting weaker compared to last year’s. After falling below its 365-day moving average on November 12, 2025, Bitcoin has dropped by 23% over the next 83 days—far more significant than the mere 6% decline seen in early 2022. Momentum seems to be fading quicker this time around.
Following a liquidation event on October 10, the index shifted to bearish territory, plummeting to zero while Bitcoin’s price hovered around $75,000. This indicates some serious structural vulnerabilities, as noted by CryptoQuant.
There’s also been a noticeable decrease in institutional demand, particularly for US Bitcoin spot ETFs. Last year, around this time, ETFs bought roughly 46,000 BTC, but in 2026, they became net sellers, unloading about 10,600 BTC. This change indicates a gap in demand of 56,000 BTC from the previous year, which has contributed to ongoing selling pressure in the market.
Investor participation from the US continues to lag, despite the drop in price. The Coinbase premium, a common gauge for US spot demand, has remained negative since mid-October. Historically, robust bull markets have been linked to periods with strong US buying that boost these premiums, but that pattern hasn’t re-emerged, suggesting that both retail and institutional buying remains limited.
On the liquidity front, conditions are tightening as well. The report from CryptoQuant noted that USDT’s 60-day market cap growth has turned negative, losing $133 million—marking the first contraction since October 2023. The expansion of stablecoins peaked at $15.9 billion in late October 2025, and this reversal mirrors typical declines in liquidity associated with bear markets.
CryptoQuant also pointed out a drastic fall in apparent spot demand growth this year, plunging by 93% from 1.1 million BTC to a mere 77,000 BTC. This reinforces the slowdown in new capital entering the market.
Furthermore, Bitcoin has now dipped below its 365-day moving average for the first time since March 2022. The steep drop of 23% over the last 83 days represents a sharper decline compared to the early days of the 2022 bear market. With a crucial on-chain support level now lost, predictions suggest that Bitcoin may slide further towards the $70,000 to $60,000 range unless catalysts emerge to revive demand and liquidity.
