Bitcoin’s demand has notably decreased since October 2025, signaling a potential return to a bear market, according to analysts from CryptoQuant. This downturn in demand is influenced by various factors such as ETF outflows, dwindling consumer interest, and prices slipping below crucial support levels.

CryptoQuant reported that there were three primary waves of demand for Bitcoin (BTC) during the current cycle. The first wave started in January 2024, triggered by the launch of Bitcoin ETFs in the US. The second followed the outcomes of the 2024 US presidential elections, while the third was related to speculation surrounding BTC treasury companies.

“Demand growth has fallen below trend since early October 2025. This indicates that the bulk of this cycle’s incremental demand has already been realized, removing a key pillar of price support.”

Institutional demand has also seen a decline, with approximately 24,000 BTC held in ETFs disappearing in Q4 2025, contrasting sharply with the accumulation trend noticed in the same quarter of 2024, as noted by CryptoQuant. Funding rates, which are fees that perpetual futures traders pay to maintain their positions, have slipped to their lowest levels since December 2023—a clear signal of an impending bear market.

The analysts also pointed out that Bitcoin’s price structure has broken down below the 365-day moving average, which serves as a significant support level for any asset.

Despite some analysts retaining a hopeful outlook for 2026, citing potential demand surges and declining interest rates as favorable catalysts, the general sentiment in the crypto market is one of fear, as reported by CoinMarketCap’s Crypto Fear and Greed Index. Currently, only 22.1% of investors anticipate that the Federal Open Market Committee (FOMC) will reduce interest rates in its upcoming January meeting.

In a further related note, US President Donald Trump previously pressured Federal Reserve Chairman Jerome Powell to consider rate cuts, with Powell’s term ending in May 2026. Trump has been exploring possible replacements who may also advocate for lower rates.