Galaxy recently published a report with a clear conclusion: Bitcoin’s current bear market may have ended in June this year, and it is now in a phase where coins are gradually being accumulated.
Note that this is Galaxy’s assessment, not a market outcome that has been confirmed. The report uses data from October 22: at the time, Bitcoin was around $81,400, 35% below its record high in October last year, but already up 39% from its low at the end of June this year.
In other words, if you’re only focused on “how far it is from breaking even,” it’s easy to overlook one thing: it has already made a significant recovery from its low.
Why does Galaxy think the bottom may already be behind us? It mainly comes down to three things.
First, old coins that had been dormant for a long time have slowed in how quickly they’re being moved out.
The report shows that the average monthly amount of Bitcoin dormant for more than five years being transferred out has fallen from 67,000 coins in 2024 to 34,000 coins this year, nearly cut in half.
It’s important to be clear here: being transferred out doesn’t necessarily mean being sold. But it at least shows that the pace at which old holdings are moving has eased compared with the past two years. This shouldn’t be interpreted as “nobody is selling anymore”; more accurately, the potential selling pressure from this group of holdings is weakening.
Second, the institutions that are exiting and the institutions that are stepping in are not the same group.
The phrase “institutional reduction” sounds pretty alarming. But after breaking down the holdings, Galaxy found that the main sellers were funds focused on arbitrage and chasing market trends; meanwhile, some wealth management platforms and sovereign wealth funds were adding positions.
From the June low to the time of the report, U.S. spot ETFs had net added about 87,000 BTC.
So over this period, it wasn’t simply that “institutions have turned bearish on Bitcoin,” but rather that some exited while others stepped in. How long the new holders will keep them remains to be seen.
Third, the price didn’t just bounce once; it held above an important level for a while.
According to the report, Bitcoin had previously spent 44 consecutive weeks below the 50-week moving average, then reclaimed it and closed above it for five straight weeks.
Don’t overstate the moving average. In simple terms, it means the price moved back above the average price of roughly the past year and hasn’t immediately fallen back below it. Galaxy sees this as a signal that the trend is improving, but it is not a guarantee of further gains.
What I think is most worth keeping from this report is that it not only explains why it is bullish, but also spells out when it would have to admit the call might be wrong.
One such condition is: if the weekly closing price falls below the 50-week moving average and cannot recover it within a month, then the bullish thesis needs to be reconsidered. At the time of the report, that moving average was around 76,540 dollars; this figure changes over time and should not be treated as a permanently fixed support level.
So my reading of this report is:
Don’t rush to conclude that “the bull market is back.” The key is to watch whether sellers are decreasing, whether buyers are increasing, and whether the price can continue to hold steady.
These signals are improving, but there is still a gap between that and “prices will definitely rise next.”
Being bullish is fine, but don’t read a bullish report as a notice to go all-in with leverage.