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Bitcoin’s current derivatives and positioning regime closely resemble late-2022 bear market conditions, typically followed by prolonged consolidation rather than immediate recovery, according to K33.
Bitcoin's
BTC-1.09%
current market structure closely resembles the late stages of the 2022 bear market, with derivatives positioning, exchange-traded fund flows, and macro indicators signaling a prolonged consolidation phase rather than an imminent breakout, according to research and brokerage firm K33
In a new report late Tuesday, K33 Head of Research Vetle Lunde said its proprietary regime indicator, which incorporates derivatives yields, open interest, ETF flows, and macro inputs such as the U.S. yield curve, shows "strikingly strong similarities" to periods in September and November 2022 — both near the global bottom of that downturn.
However, while those historical regimes marked market lows, they were followed by extended stretches of sluggish price action, producing muted forward returns and lengthy consolidation periods, Lunde noted.
Bitcoin has already fallen sharply from recent highs, shedding nearly 28% since January, while broader derivatives signals show defensive positioning, according to K33. Funding rates have remained negative for more than 11 consecutive days, and notional open interest fell below 260,000 BTC, reflecting investors unwinding long positions, Lunde said. This positioning, combined with declining leverage, suggests a low near-term risk of derivatives-driven squeezes, he added.
Consolidation rather than immediate recovery
K33 said its model assigns the greatest weight to derivatives data, which reflects real-time demand for hedging or upside exposure. Negative yields signal excess hedging demand, while falling open interest indicates traders exiting positions rather than building new directional bets. The current regime, Lunde said, aligns with environments historically associated with market bottoms but not rapid recoveries.
The firm noted that similar historical regimes delivered average 90-day returns of roughly 3% in strongly similar environments and slightly negative returns in moderately similar ones, underscoring the likelihood of slow, discouraging consolidation. Lunde expects bitcoin to trade between $60,000 and $75,000 for a prolonged duration, describing current entry levels as attractive while emphasizing the need for patience.
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Market activity has cooled significantly following recent sell-offs. Bitcoin spot trading volumes dropped 59% week over week, while futures open interest declined to four-month lows — behavior consistent with markets absorbing losses and stabilizing after major drawdowns, the firm noted. Volatility has begun to normalize as prices stabilized, further supporting expectations for a quieter trading environment, Lunde said.
Institutional positioning also reflects similar caution, according to the report.
Institutional traders on CME have remained largely inactive, with muted yields and shallow open interest reflecting limited directional conviction. Meanwhile, bitcoin exchange-traded products have seen a record drawdown of 103,113 BTC from peak holdings since October, though roughly 93% of peak exposure remains intact despite bitcoin retracing nearly 50% over the same period. This suggests institutional investors have reduced exposure but largely maintained positions through the downturn, Lunde said.
Meanwhile, sentiment indicators highlight extreme pessimism but offer limited predictive value, in the analyst's view. The Crypto Fear and Greed Index recently hit an all-time low of 5, reflecting widespread fear, though he noted that such readings historically have not reliably signaled strong rebounds.
Buying bitcoin during extreme fear has produced average 90-day returns of just 2.4%, compared with 95% when buying during extreme greed, underscoring that extreme fear does not reliably signal strong rebounds, Lunde said.
K33 concluded that bitcoin's current market regime shares key characteristics with late bear market environments, suggesting downside risks may be limited, but recovery could take time, echoing the drawn-out stabilization phase that followed the 2022 bottom.
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I used to think memecoins were fireworks—bright, loud, and gone before the smoke had time to settle. I’d watch them streak across my screen, laugh at the absurdity, and move on, convinced the whole thing was a digital prank with a price tag. But lately the joke has grown teeth, and I can’t pretend it’s just comedy anymore. As Mr_Green, I’ve started seeing memecoins less like punchlines and more like prototypes—wild little experiments where culture, incentives, and crowd psychology get stitched into something that behaves like a product.
$BULLA
The new generation doesn’t just “launch.” It performs a launch, like a stage show with trapdoors. You don’t merely buy; you enter a loop. The mechanics are the main character now: curves that shape price like a riverbank shapes current, fees that drip back into the “community” like a stipend for staying excited, and gamified rituals that turn holding into a hobby and shilling into a sport. I’ll catch myself thinking, this is ridiculous—then two minutes later I’m analyzing it seriously, like it’s a startup’s growth funnel. That’s the trick: memecoins learned to borrow the language of product design without ever surrendering their chaos.
$JELLYJELLY
What surprises me most is how honestly dishonest it feels. A memecoin used to hide behind irony, as if saying “this is dumb” made it harmless. Now it’s upfront about being engineered to attract attention and keep it circulating. It’s not a lie; it’s a machine that runs on belief, and belief is something crypto has always known how to bottle. I see launchpads that resemble arcades: spin the wheel, mint the token, join the chat, earn the badge, recruit the friend. It’s a carnival that keeps receipts.

And I can’t deny the craft. There’s a certain beauty in watching a narrative become an instrument. The meme is still the hook—cute animal, cursed phrase, absurd mascot—but the hook is attached to a line with knots tied by people who understand liquidity, social momentum, and the hunger for belonging. These aren’t coins that happen to go viral; they’re coins designed to engineer virality. The community isn’t a happy accident; it’s a system that rewards coordination and punishes silence. I’ve seen groups treat “engagement” like oxygen, measuring it, rationing it, weaponizing it.
$POWER
As Mr_Green, my thoughts keep circling the same question: is this evolution or escalation? Memecoins used to be a mirror reflecting market mania. Now they’re a workshop manufacturing it. That feels both more impressive and more dangerous. When the mechanism is refined, the cycle speeds up, and speed has a way of making people confuse motion for progress. I’ve watched friends become traders, traders become promoters, and promoters become priests of whatever mascot happens to be paying attention that week. The line between fun and finance blurs until you can’t tell if you’re laughing or coping.

Still, I don’t want to dismiss it. Memecoins, for all their nonsense, are doing something important: they’re stress-testing how quickly humans can coordinate around stories. They reveal what people value when the rules are loose and the rewards are instant. They show that in crypto, culture isn’t decoration—it’s infrastructure. The meme is the interface; the mechanic is the engine.

I’m left with a strangely sober conclusion for something so unserious. The joke didn’t die. It matured. And maturity, in crypto, doesn’t always mean safer. Sometimes it means more effective. Sometimes it means the same firework—only now it knows how to aim.

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