Bitcoin Eyes Bottom as On-chain Metrics Stabilize
Bitcoin has experienced its third-largest drawdown of the current cycle, dropping 25% from its all-time high to below $94,000. Despite downward momentum on shorter timeframes, realised losses and selling pressure have begun to stabilize. Key on-chain exhaustion signals—such as the short-term holders’ realised profit-loss ratio falling below 0.20 and only 7.6% of supply in profit—suggest a local bottom is forming. Meanwhile, macroeconomic headwinds persist: the recent 43-day U.S. government shutdown inflicted permanent GDP losses, dampening market sentiment amid sticky inflation and business optimism declines. On the regulatory front, a bipartisan Senate draft bill proposes shifting crypto oversight from the SEC to the CFTC, classifying most tokens as digital commodities. In industry developments, Polymarket will provide live prediction-market data during UFC events, and the Czech National Bank launched a pilot digital asset portfolio including Bitcoin and a stablecoin. Together, these factors set the stage for potential Bitcoin stabilisation into late Q4.
Bullish
In the past, on-chain exhaustion metrics—such as a realised profit-loss ratio below 0.20 and minimal profitable supply—have coincided with local bottoms, often preceding price recoveries. Stabilising selling pressure indicates capitulation may be ending. Although macro headwinds from the US government shutdown, sticky inflation and regulatory uncertainty could limit short-term gains, the confluence of technical and on-chain signals suggests traders may begin accumulating near current levels. This base-forming environment points to a bullish setup for Bitcoin into late Q4, even if broader market sentiment remains cautious in the near term.