Julio Moreno, Head of Research at CryptoQuant, recently declared that Bitcoin is in a bear market that could last until the third quarter of 2026.
he is not alone. Bitwise’s Matt Hogan and a growing chorus of organizations have been using the label “bear” more freely than ever since early 2023.
However, those same analysts often use structure to hedge. Many financial institutions continue to maintain or add to their exposure while acknowledging the change in government.
This raises a definitional problem. If a bear market no longer means capitulation or exit, what does it mean?
If the famous four-year cycle is gone, as VanEck, K33 Research, and 21Shares each claim in their recent reports, how long will the bear market last if the lunar calendar no longer applies?
What constitutes a bear market
The traditional financial definition of a bear market is a starting point.
The U.S. Securities and Exchange Commission defines a bear market as a decline of 20% or more in a broad index over at least two months. Bitcoin cleared that threshold a few months ago.
From a peak of over $126,000 in early October 2025, BTC has fallen by about 41% to about $74,000 as of February 3. According to headline standards, the case is solved.
However, Coinbase Institutional’s research clearly states that the 20% threshold is “somewhat arbitrary” and does not really apply to cryptocurrencies, which can experience 20% swings without a true regime change.
In fact, analysts utilize a dashboard that consists of three parts: price trends, positioning and derivatives, and demand and liquidity.
The price trend is the most obvious. CryptoQuant relies heavily on the 365-day moving average as a boundary marker.
Bitcoin is currently trading below that level, at around $101,448. CryptoQuant’s bull score index, which comprehensively measures on-chain health, scored 20 points out of 100, which is described as extremely bearish territory.
Coinbase uses a 200-day moving average to identify bear markets in its historical cycle analysis, and Bitcoin continues to remain below that threshold.
Positioning and derivatives provide a second signal. Glassnode’s recent Week On-Chain report documents conditions that increase downside sensitivity, including rotation for downside protection, a bearish bias in the options market, and a dealer gamma below zero.
Markets act defensively when traders pay a premium to hedge against further declines rather than to capture upside.
Demand and liquidity provide the structural context. CoinShares estimates that large holders have sold about $29 billion of Bitcoin since October. Approximately $440 million has been drained from publicly traded digital asset products since the beginning of the year.
CryptoQuant and MarketWatch characterize the current regime as combining declining stablecoin liquidity with weak demand, typical elements of a bear market.
The latest global investor survey from Coinbase Institutional and Glassnode, conducted from December 10, 2025 to January 12, 2026, found that 26% of institutions say the market is currently in a bearish phase. This result was up from just 2% in the previous survey.
However, the same survey revealed that 62% of institutions have held or increased their net-long exposure since October, and 70% view Bitcoin as undervalued.
This disconnect is a hallmark of the 2026 bear market. It is not about capitulation, but about recognizing the regime while maintaining structural exposure.
The label “bear market” is becoming less about who is running away and more about who is still buying, even though market sentiment remains dire.
When will this bear market end?
To define the end of a bear market, we need to be clear about what we mean by “end.”
The most rigorous approach treats this as a regime change rather than a sentiment. Analysts identify three practical triggers: a reversal of trends, a reversal of demand, and a normalization of risk appetite.
A trend recovery occurs when Bitcoin recovers and maintains its long-term moving average, such as 200-day or 365-day, for multiple weeks.
Modulations in demand mean exchange-traded funds and exchange-traded products move from subdued or negative inflows to sustained inflows, slowing distributions to large holders.
Normalization of risk appetite means that options bias returns to a balanced level, reducing the demand for downside protection and persistently building leverage.
The forward-looking scenarios are categorized into three time periods, each supported by specific analyst commentary.
The first scenario is a classic crypto winter that lasts until mid or late 2026.
Julio Moreno identified deeper potential paths of $70,000 in three to six months and $56,000 in the second half of 2026. This scenario assumes that demand remains weak, flows remain negative, and Bitcoin fails in repeated attempts to regain its moving average. Bear market rallies occur, but they don’t last.
The second scenario is a short, shallow bear market lasting 3-6 months, characterized by volatile, range-bound price movements, before conditions improve in the second half of 2026.
CoinShares clearly expects a constructive situation in the medium term and a volatile period of 3-6 months as whale sales dry up by mid-2026.
In this framework, bear markets are more a matter of time than depth. In other words, the upper limit is limited until demand reverses, but the lower limit is maintained.
The third scenario treats bear markets as liquidity wave events rather than calendar-based cycles.
Regardless of what the halving clock says, the bear market will end when demand and liquidity accelerate again. This maps directly to CryptoQuant’s demand-driven framework and avoids determinism due to half-lives. We acknowledge that the old playbook may no longer apply.
| scenario | horizon | what is it looks like | Key triggers to monitor | what would you do disable that |
|---|---|---|---|---|
| classic winter (Moreno path) | Mid/late 2026 | A failed meeting. deeper retest | Continuous collection failures 200D/365D;weak current; Sustainable downside hedge | Recovery + Maintain Above MA and Flow turns positive sustainably |
| short and shallow bear (CoinShares Pass) | 3-6 months | Range limited chop. cap facing upwards | Stabilization of ETP flows. Slowdown/depletion of whale sales | Breakdown below key support zones due to increasing liquidation pressure |
| Liquidity wave system (after 4 year cycle) | variable | Exit when liquidity and demand changes, not on a calendar | Global liquidity proxy, real yield, stablecoin liquidity, demand hedging | Liquidity improves, but BTC still cannot recover long MA (suggesting structural weakness) |
Is this bear market smaller than previous cycles?
The current drawdown of around 40% is already small compared to the typical 70%+ crypto winters of previous cycles.
However, the downside scenarios by multiple analysts are concentrated around $55,000 to $60,000, suggesting that if realized, the total drawdown will approach the mid-50% range.
While this is still below historical extremes, it is significant enough to qualify as a bear market by any standard.
The market is also increasingly polarized. While Bitcoin retains its structural leadership, the rest of the cryptocurrency market is performing much worse.
Coinbase and Glassnode reports highlight this through dominance indicators and defensive positioning actions. The market in 2026 will be K-shaped, and a “bear market” could have an uneven impact on asset classes.
The four-year cycle is over, but what will replace it?
Van Eck argued that in 2025, the four-year cycle will break down, making the old strategy less reliable.
K33 Research has released a report entitled “The four-year cycle is dead, long live the King” which reveals the reason for the change of government.
21Shares explains that this cycle is evolving and could extend to five years as liquidity waves lengthen and institutional investor participation deepens.
The alternative to the four-year clock is the liquidity and flow clock. This includes real yields, global liquidity impulses, exchange traded fund and exchange traded product flows, stablecoin liquidity, and hedging demand.
CoinShares clearly frames Bitcoin’s recent turmoil in terms of the relationship between precious metals and macro liquidity. Coinbase and Glassnode highlight defensive posture in derivatives as a real-time posture indicator.
What a bear market period means is that bear markets become more frequent but less severe. If institutional flows provide a lower bound, markets may experience more frequent regime contractions rather than survival winters.
The rally may fail until demand and liquidity improve, but the underlying structure could prevent the kind of multi-year capitulation that characterized past cycles.
This creates a paradox. Bear markets can last longer in calendar time, but they do less damage in percentage terms. Or it may end sooner if demand changes before the old cycle logic predicts.
In any case, the clock that ruled Bitcoin for a decade no longer rules Bitcoin.
Checklists are more important than calendars
In 2026, whether there will be a bear market will not be a single metric, but a checklist.
Trend breaks, demand hedging, demand and liquidity rollovers all point in the same direction. Bitcoin is in a bear market in most important frameworks.
When it ends depends on the timing of the demand cycle rather than the halving calendar. CoinShares expects a sharp decline in 3-6 months. We believe that CryptoQuant could reach further lows in the second half of this year.
If the administration vacillates without a clean resolution, both sides may end up being right at different times.
Although the four-year cycle is over, the question of when this bear market will end remains unanswered. It ends when Bitcoin regains its long-term moving average, when institutional flows turn positive, and when the options market stops pricing for protection.
Until then, the market is in a position to limit the upside, and patience is required. Even if institutional investors say it’s bearish and keep buying.
(Tag translation) Bitcoin
