Bitcoin has largely ignored macroeconomic signals that should have supported its price. The U.S. consumer price index fell to 2.7 percent in December, reinforcing expectations of interest rate cuts, but Bitcoin did not react. No new capital flowed into the markets, and the price stalled as money shifted to other assets.
Because of this difference, the discussion of Bitcoin's bear market has resurfaced.
Fidelity's global macro director Jurrien Timmer has recently warned that Bitcoin's latest four-year cycle may have ended as early as October in terms of price and timing. The blockchain and market data since then increasingly supports this view.
Data indicators suggest that Bitcoin may already be in a bear market
Many independent metrics now point to the same conclusion: capital is withdrawing, committed owners are selling, and Bitcoin is bearing risk without real demand.
Stablecoin investments have collapsed since the cycle peak
Stablecoin investments often serve as a reserve for price rallies in the cryptocurrency markets. This fuel is now absent.
Total investments in ERC-20 stablecoins across all exchanges peaked at about $10.2 billion on August 14. By December 24, investments had fallen to approximately $1.06 billion, a nearly 90 percent decline.
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The investment peak in August occurred just before Bitcoin rose above $125,000 in October, precisely during the period Timmer identified as a likely cycle peak.
Since then, fresh capital has not returned to the markets, reinforcing the idea that instead of accumulation after the peak, there has been distribution.
Long-term holders have turned aggressive sellers
Committed investors have behaved differently since October.
The net position changes of Bitcoin's long-term holders turned negative shortly after the cycle peak. Sales accelerated from around 16,500 Bitcoins per day at the end of October to the current approximately 279,000 Bitcoins per day. Thus, the distribution pressure on a daily basis has increased by over 1,500 percent.
This aligns directly with Timmer's theory that the four-year halving cycle phase likely ended in October. Long-term holders seem to agree, as they reduce their exposure instead of defending the price.
Bitcoin dominance is increasing, but not for bullish reasons
Bitcoin's dominance has risen back to between 57-59 percent, but this is not a sign of risk-taking.
Following a softer consumer price index, capital did not flow into Bitcoin. Instead, funds flowed into traditional safe havens. The price of silver has risen over 120 percent in a year, gold about 65 percent. Meanwhile, the entire cryptocurrency market has lagged significantly.
This trend reinforces the view that Bitcoin's rising dominance is not due to new risk-taking but rather capital withdrawing to relative safety within the crypto market.
The same perspective was expressed by Ray Youssef, founder and CEO of NoOnes, in a market comment provided to BeInCrypto. He emphasized why gold has led the currency weakening trade of 2025 while Bitcoin remains in a narrow trading range.
"While gold appears to be winning the price development aspect of the 2025 currency weakening trade, the comparison obscures a more complex market reality. Gold's rise to new all-time highs and 67% return this year reflect a defensive investor chain seeking certainty in a market characterized by fiscal overreach, geopolitical tensions, and uncertainty in macroeconomic policy. Increased purchases by central banks, a weaker dollar, and persistent inflation risks have reinforced gold's role as the market's preferred defensive asset," he noted.
Youssef added that Bitcoin's behavior this year has clearly diverged from the narrative of digital gold.
"Bitcoin has not recently succeeded in fulfilling the safe-haven role. The asset has not behaved like digital gold in 2025, as it reacts more sensitively to macroeconomic factors. Bitcoin's upside potential is now related to increased liquidity, clarity in state policies, and risk sentiment, not just the depreciation of money value," he emphasized.
Mega-whale addresses are quietly declining
The number of large holders has also decreased.
The number of Bitcoin addresses holding over 10,000 BTC has decreased from 92 at the beginning of December to 88. This decrease occurred simultaneously with falling prices and was not an accumulation phase.
These addresses often represent institutional investors' scale. Their decrease reinforces that smart investors are not currently positioning aggressively for a rally.
Bitcoin remains below the critical long-term moving average
Bitcoin continues to trade below its 365-day moving average near $102,000 – this level has not been clearly broken since the start of the bear market in 2022.
This moving average serves as both a technical and psychological support level. If this level is not regained, the market is likely to shift from a continuation of the trend to a risk phase. If the price stays below this level, historical examples suggest deeper decline areas near traders' realized price range around $72,000.
Together, these signals support Timmer's warning that Bitcoin may already be in a bear market phase or approaching it, even if the price does not yet fully reflect this. Capital has dried up, committed holders are selling, dominance is rising defensively, and macroeconomic relief is not being considered.
However, not all long-term support levels have yet failed. These counter-signals and precise level shifts that determine whether this will become a full bear market or a long transition phase will be addressed next.
Why the Bitcoin bear market is not yet fully over
Although more and more evidence points to a bear market for Bitcoin, two long-term cycle indicators do not yet support a structural collapse.
One reason why a bear market for Bitcoin has not yet been confirmed relates to how the markets interpret the slowing inflation (CPI). Although cooling inflation generally benefits risk assets, this time investors seem to emphasize safety and liquidity over growth.
This does not mean that the CPI signal is wrong. Bitcoin has historically reacted later than traditional safe instruments, so the effects are only visible when liquidity expectations shift into capital flows.
These and the next indicators to be discussed do not negate the aforementioned downside signals. However, they explain why the current phase may be a long transition, not yet a complete bear cycle.
Pi Cycle Top has not activated
One of the most reliable cycle indicators for Bitcoin, Pi Cycle Top, has not shown a peak signal. The indicator compares the 111-day moving average to the 350-day moving average multiplied by two.
Historically, when these two lines intersect, Bitcoin has been at or near significant cycle peaks.
Currently, these two lines are clearly separate from each other. This suggests that Bitcoin is not in an overheated or euphoric phase, even though the October peak was seen.
This contradicts the view of Fidelity's Global Macro director Jurrien Timmer, who indicated that the October peak near $125,000 coincided with previous cycle highs.
In previous cycles, bear markets began only after clear Pi Cycle confirmations. This signal has not yet been seen.
The 2-year SMA remains the most important threshold
Another, more immediate counter-argument is structural. Bitcoin continues to trade near its 2-year simple moving average, which is around $82,800.
This level has repeatedly served as a long-term trend line for Bitcoin. Monthly closes remaining above this level have historically signified the preservation of the cycle.
Prolonged trading below this level has signified deep bear market periods.
So far, Bitcoin has not confirmed a monthly close below this line.
The December monthly close is therefore particularly important. If Bitcoin stays above $82,800 by the end of the year, the market is likely still in a late cycle transition, not in a confirmed Bitcoin bear market.
This still leaves open the possibility that 2026 will bring delayed upside rather than a prolonged downturn.
If the December close clearly falls below the 2-year SMA, the downside targets mentioned by Timmer between $65,000 and $75,000 will gain structural support.
TL;DR — Key Bitcoin price levels to watch now
There are also clear levels for refuting the bear market scenario. If the 365-day moving average, which is around $102,000, is reached again, the bear market thesis weakens significantly. This would correspond to Tom Lee's year-end Bitcoin price estimate.
Breaking this level triggered the bear market of 2022. Its recovery signaled a renewed confirmation of the trend.
To simplify:
Over $82,800 at December close: the transition phase remains in effect
Under $82,800 on a monthly basis: the risk of a bear market is increasing
Back above $102,000: the bullish trend structure begins to strengthen
At the moment, Bitcoin is caught between convincing selling and long-term cycle support. The markets do not show clear strengthening, but they are also not collapsing completely.
The December close will determine which story continues into 2026.
