Brothers, can we stop trying to cut the sword with the boat? Many people like to use the mindset of cutting losses from 2022 in the present; isn't that just giving away money?

In this recent round of decline, I've seen some people shouting about replicating the crash of 2022. I am someone who always looks at the data because data doesn't lie. The underlying logic of this bear market is already different from that of 2019, 2020, and 2022. Today, I will talk about three core points that, if understood, could save you at least hundreds of thousands.

Talking about numbers is a bit boring, let's get straight to the picture👇

🔥Core 1: Market players are changing! A shift from 'retail panic' to 'institutional support'

I think veteran investors can feel the difference. The last three bear markets were just retail investors having their own fun, chasing highs during the rise due to FOMO, and panicking during the drop, with no one to protect the market, resulting in worsening losses. Back in 2019, it dropped directly from 7.3k to 3.2k, a decline of 56%, all due to retail panic selling, but there were no large funds coming in to take over, and the more it fell, the more panic ensued. Then in 2020, the low dropped to 4k, and when the pandemic hit, retail investors all ran away, leading to a complete liquidity dry-up in the market. You couldn’t sell even if you wanted to and could only lie flat. Finally, in 2022, it was the worst, with the FTX black swan explosion combined with institutions using high leverage, causing a drop from 69k to 16k, a 77% decline, with indiscriminate liquidations across the market, affecting both mainstream and altcoins.

But this year, my personal feeling is really different; institutions have become the stabilizing force in the market. While retail investors are panicking and making rash decisions, they are secretly picking up chips, adding to their positions when prices fall. The data from Cryptoquant shows that exchange BTC reserves dropped from 3.02M BTC to 2.74M BTC, with a net outflow of a full 280k BTC. Do you think this is institutions fleeing? I think they are locking in and stockpiling.

For example, many are familiar with MSTR, which just increased its holdings by 855 BTC in January, bringing its total holdings to 713502 BTC. Japan’s Metaplanet also raised 135 million, doing nothing but specifically buying BTC. What do you think makes them able to make such choices? As for the near 1 billion outflow from the ETF in a single day, long-term institutional holdings have remained very stable. To put it simply, they are borrowing the dip to accumulate while waiting for retail investors to sell off.

In the past, when the market fell, there was truly no one to take over, and the decline just got worse. Now, the drop is institutions bottom-fishing, so don't let yourself be washed out and lose just before dawn.

🔥Core 2: The macro environment has shifted from 'tightening causing declines' to 'easing supporting the bottom' (underlying logic).

The reason everyone lost so badly in the last three bear markets was that they were helpless, all pressed down by the Federal Reserve's tightening policies. In 2019, the Fed's balance sheet reduction was nearing its end, and market liquidity was particularly tight; all risk assets were under pressure, and BTC was no exception. In 2022, the Fed directly raised interest rates aggressively from 0% to 4.5%, and BTC fell alongside NASDAQ, meaning if you dared to buy, it dared to drop. However, the expectation of rate cuts in 2026 is extremely high, and the macro environment is not only not dragging us down but is also continuously supporting us. Mester said this year there will be a rate cut of about 1 percentage point, and Bostic has also expressed support for one or two rate cuts; this signal is already very clear.

Still the same saying, I only let the data speak. I checked the CME FedWatch data and found that the probability of maintaining interest rates in March is 84.7%. However, the expectation of rate cuts for the entire year has never stopped, just a bit slower in pace. Coupled with the implementation of the U.S. funding bill and many central banks shifting towards easing, this is a complete reversal compared to the tightening cycle of 2022. Previously, the Federal Reserve forced you to drop, and now they are directly helping you to stabilize.

🔥Core 3: On-chain signal reversal! From 'panic selling' to 'whales accumulating' attitude.

The worst part of the last three bear markets was for retail investors, who sold off until numb, ending up at the lowest point with nothing but blood in their rearview. The bottom of 2022 was typically characterized by MVRV dropping to 0.85 and SOPR hitting 0.7, with an increase in exchange inflows. After retail investors sold off, the whales came in to pick up the pieces, completing a perfect harvesting loop! Now, on-chain signals are all indicating that whales are accumulating, so brothers, don’t sell at the bottom and become fodder for the market.

Currently, the MVRV is at 1.249, indicating fair valuation; NUPL at 0.1997 is also close to the bottom range of 2022, and we have not reached the extreme panic phase yet, so we can gradually build positions. SOPR at 0.9861 indicates only slight losses, and with continuous net outflows from exchanges, on February 10th alone, there was a net outflow of -1232 BTC. It is evident that funds are accumulating rather than being sold off, alongside whale movements, with 7 Siblings purchasing 24,000 ETH in two days. BTC on-chain is also showing similar accumulation actions, with chips becoming increasingly concentrated, indicating that there will definitely be operations in the future.

So currently, the bear market is not a crash; institutions are just bottom fishing. As long as we get through it, spring will come.

Brothers, where do you think BTC will drop to?