Bitcoin’s Bear Market May Be Over, According to CryptoQuant’s Profitability Indicator

CryptoQuant’s Bullish Signal

Cryptocurrency analytics platform CryptoQuant has declared that Bitcoin’s bear market has concluded, based on a composite profitability indicator that recently flipped positive. The platform’s CEO, Ki Young Ju, highlighted the significance of this shift in recent commentary. The Bull/Bear Market Cycle Indicator returned to positive readings for the first time since early October 2025, marking a meaningful inflection point in the asset’s price dynamics. Notably, this same indicator successfully signaled the end of Bitcoin’s previous bear market during the early months of 2023, lending credibility to its predictive framework.

How the Indicator Works

The Bull/Bear Market Cycle Indicator employs a sophisticated methodology that synthesizes multiple onchain profitability measurements. The framework incorporates three primary components: the market value to realized value (MVRV) ratio, which compares Bitcoin’s current market capitalization to the aggregate value of historical realized transactions; net unrealized profit/loss (NUPL), which tracks investors’ aggregate gains or losses at current prices; and the spent output profit ratio (SOPR), which measures the profitability of transactions occurring on the blockchain. These metrics are measured against their 365-day moving averages, allowing the indicator to determine the distance between current profitability conditions and their year-long baseline.

When the indicator reads above zero, it typically signals a bullish phase in Bitcoin’s price cycle as investor profitability improves. The depths of the current downturn became evident on February 5, when Bitcoin’s price fell to $60,000 and the Bull/Bear Indicator registered -1.244, representing extreme bear conditions. As of August 26, the indicator had improved to 0.042, a positive reading that places it within the bull bracket.

Market Skepticism Persists

Despite the positive indicator reading, the cryptocurrency trading community remains divided on whether Bitcoin has genuinely established the foundations for a sustained recovery. Concerns persist about the depth of demand for Bitcoin at current prices and whether purchasing pressure can overcome several liquidity barriers positioned above spot price levels. Trader and analyst Rekt Capital has characterized the August monthly close as a pivotal moment, noting that Bitcoin must break through a downward-sloping resistance trend line that has remained in place since October of the previous year. Additional technical indicators, including the relative strength index (RSI), have begun showing recovery patterns similar to those observed at the end of 2022, though such signals do not guarantee that upward movement will persist.

If CryptoQuant’s indicator proves as reliable as its 2023 performance suggests, this could mark the beginning of a new bull phase for Bitcoin and create positive ripple effects across the broader cryptocurrency sector. For the wider crypto market, a confirmed Bitcoin recovery could signal renewed capital flow into digital assets and blockchain infrastructure projects, including XRP.

Source: CryptoQuant, via Cointelegraph. Not financial advice.