 ▲ Bitcoin (BTC), decline, bear market / ChatGPT-generated image |
Despite the recent rebound, warnings are emerging that the Bitcoin market may still be in the midst of a bear market. Analysts point to three factors suggesting the possibility of further declines: geopolitical inflation risks, on-chain indicators, and technical patterns.
According to investment media outlet FXStreet on March 5 (local time), Bitcoin (BTC) has maintained relatively stable movement above $70,000 despite rising tensions in the Middle East, but its long-term outlook still carries bearish risks. Although market expectations are growing that the correction has ended, some analysts believe the downward cycle may not yet be over.
The first risk factor is inflationary pressure triggered by geopolitical conflict. With clashes involving the United States, Israel, and Iran raising the possibility of a blockade of the Strait of Hormuz—through which about 20% of global oil supply passes—international oil prices have surged more than 15%. Higher energy prices could intensify inflationary pressures, potentially delaying interest rate cuts by central banks or prompting renewed tightening measures. Elevated interest rates tend to reduce market liquidity and shift investment capital toward traditional safe-haven assets such as the U.S. dollar or gold, posing a headwind for the cryptocurrency market.
The second factor involves on-chain valuation indicators. According to CryptoQuant data, the Market Value to Realized Value (MVRV) ratio currently stands at around 1.3, meaning it has not yet entered the extreme undervaluation zone that historically signaled market bottoms. The Net Unrealized Profit/Loss (NUPL) indicator, which reflects investors’ unrealized gains and losses, is also trending downward while remaining above the undervalued zone. Historically, market bottoms have often formed when investors experience unrealized losses of around 20%, a level the current market has yet to reach.
Based on these indicators, a potential bottom price has been estimated at approximately $56,500. In past bear markets, Bitcoin prices have typically fallen 24% to 30% below the realized price band before forming a bottom over a period of four to six months. The current price remains about 22% higher than this benchmark, suggesting that a definitive bottom signal has not yet appeared.
Technical analysis offers similar warnings. After reaching an all-time high of $126,199 in October 2025, Bitcoin fell more than 50% by February 2026 and closed below the 200-week exponential moving average on the weekly chart. This pattern is interpreted as similar to the early stages of the 2021–2022 bear market. At that time, Bitcoin declined about 77% from its peak to $15,476 and experienced a downward cycle lasting approximately 378 days.
Analysts caution that the current rebound could represent a temporary rally within a longer-term downtrend. If the market follows a pattern similar to previous cycles, Bitcoin could decline to around $28,300 before beginning a new bullish phase.
Disclaimer: This article is for investment reference only and does not take responsibility for investment losses incurred based on its content. The information provided should be interpreted solely for informational purposes.