Bitcoin’s journey in 2025 was predicted to be a “supercycle,” driven by increased institutional access and a more favorable policy environment in Washington. However, as the year comes to a close, the reality is starkly different.
Instead of a new paradigm, Bitcoin is facing a performance slump. The rally has lost momentum, prices are declining, and retail interest is waning. The narrative that supported the price surge has given way to a correction based on market dynamics.
Analysts now suggest that Bitcoin is in a “bear season” due to a lack of demand at current price levels. Key indicators, such as US spot Bitcoin ETFs shifting from net accumulation to net redemptions, point to a structural deficit in demand.
The bullish narrative that emerged in 2025 started to unravel when it became apparent that the highs achieved during the year were not sustainable. Bitwise CEO Hunter Horsley believes that Bitcoin has been in a bear market disguised as a bull market since February. This is supported by data showing a decrease in demand growth compared to earlier in the year.
The market is now trading based on its inherent demand rather than artificial factors like ETF launches or post-election positioning. The current selling pressure and lack of incremental buyers are indicative of a market struggling to find its footing.
Two opposing views have emerged regarding the future of Bitcoin in 2026: one focusing on liquidity and the other on time. While some believe that the market cycle has been extended due to macroeconomic factors, others see a structural end to the current cycle.
For Bitcoin to exit the bear market, ETF flows need to stabilize, demand growth must increase, funding rates should recover, and the price needs to reclaim certain levels. Until these signals turn positive, Bitcoin will continue to navigate through a challenging market environment.
In conclusion, the path ahead for Bitcoin is uncertain, with conflicting perspectives on its future trajectory. The market will need to undergo significant changes to transition out of the current bear season and into a more stable phase.
