According to a research alert from Galaxy Research, bitcoin’s bear market concluded in June, transitioning the asset into an accumulation phase. The report notes, “We believe now is an attractive time to buy and hold bitcoin.”
At the time of the publication, bitcoin was trading near $80,000, sitting roughly 35% beneath its October 2025 peak and 39% above its June 30 trough. To break its previous record, the price would need to climb by 53%. Meanwhile, the S&P 500 stands within 1% of the record it established on October 6.
The research outlines four distinct arguments to support this outlook: technicals, positioning, fundamentals, and sentiment.
Bitcoin technicals
Galaxy tracks bitcoin bear markets using two weekly moving averages. The firm highlights that the 200-week average has historically served as a floor, while the 50-week average has acted as a ceiling.
After losing the 50-week average in November 2025, bitcoin remained beneath it for a span of 44 weeks. The June low successfully tested and held the 200-week average, with the worst weekly close landing 4.7% below that line. By September, the price closed back above the 50-week average, and the week ending October 18 marked the fifth straight weekly close over that threshold.
Galaxy notes that since 2011, it has recorded 13 such reclaims, with subsequent performance depending on how long the price stayed below the line. The four reclaims that followed periods lasting 20 weeks or longer were higher a year later by margins ranging from 55% to 1,497%, and none fell more than 8.4% below the reclaim price over the next 12 months. Conversely, of the nine reclaims ending shorter spells, seven dropped more than 25% within a year.
The firm adds that the halving cycle points to a similar conclusion. Previous cycles bottomed 777, 889, and 912 days post-halving, whereas October 22 marked day 916 of the ongoing cycle. Galaxy points out that the gains following those previous lows (87x, 19x, and 7.6x) have diminished each cycle, and the firm does not expect a repeat.
Furthermore, the current 53% drawdown stands as the shallowest in the history of bitcoin, representing the first cycle where the price avoided dropping below the network’s realized cost basis.
Positioning
The report identifies basis traders and macro funds as the primary sellers since the market top. Commodity Futures Trading Commission data cited by Galaxy reveals that asset managers’ net long positions in CME bitcoin futures dropped 57% from the week of the all-time high.
Similarly, leveraged funds decreased their net short positions—representing the futures leg of the cash-and-carry trade against spot ETFs—by a comparable amount. The front-month basis averaged an annualized 7.9% over the 30 days leading up to the high, but fell to 4.8% in the 30 days leading to October 21. Galaxy states this level no longer adequately covers the costs and risks of the trade.
To pinpoint the sellers, Galaxy evaluated 13F filings. Between the quarter-ends of September 2025 and June 2026, firms such as Millennium Management, Brevan Howard, Goldman Sachs, Capula, Farallon, D. E. Shaw, Schonfeld, Symmetry, and Tudor reduced their spot ETF allocations by 29% to 100%, shedding a combined 68,000 BTC.
Because total holdings across all 2,200 filers decreased by 48,000 BTC overall, other institutions stepped in to buy. Notable net buyers included Morgan Stanley’s wealth management division, Mubadala, and the Abu Dhabi Investment Council.
Overall, spot ETF holdings contracted by 11% from peak to trough while prices fell 53%, and these funds have since added 87,000 BTC following the June low.
Fundamentals and sentiment
Galaxy’s fundamental thesis is rooted in U.S. fiscal metrics. Federal debt hit $40.44 trillion on October 20, the 2026 fiscal year wrapped up with a $1.99 trillion deficit, and the 10-year Treasury yield touched 5.31% on October 5, marking its highest point since 2007.
The firm argues that a government forced to refinance its debt at 5% while running 6% deficits will face mounting pressure to inflate.
Regarding AI-driven borrowing—projected by Morgan Stanley to reach $570 billion this year—the report characterizes it as a contributor to these financial pressures rather than a direct competitor for capital.
On the sentiment front, Galaxy draws parallels between the current market climate and the 2015–16 and 2018–19 eras, when traditional finance championed “blockchain” technology while dismissing bitcoin, coinciding with cycle bottoms. The firm argues the 2026 iteration centers on “stablecoins and tokenization, not bitcoin,” pointing to bank pilots for tokenized deposits, the Senate’s failed cloture vote on the Clarity Act on September 15, and Google search interest for “bitcoin” sitting at multiyear lows.
Risks
Galaxy outlines a clear warning sign for its bullish thesis: a weekly close beneath the 50-week average (approximately $76,540) that fails to recover within a month. The report also highlights AI-enabled theft—such as the $387.5 million Bitget exploit—while noting that none of these events involved vulnerabilities in the Bitcoin protocol itself.
Addressing quantum computing, the report notes that while 7.1 million BTC reside in outputs with exposed public keys, a cryptographically relevant quantum computer does not currently exist. Galaxy references the merging of BIP-360 into the BIP repository in February alongside its own $5 million commitment toward quantum readiness.
FAQ
Is the bitcoin bear market over according to Galaxy?
Yes, Galaxy Research believes the bear market ended in June and that bitcoin has transitioned into an accumulation phase.
What price levels were cited in the report?
At the time of the note, bitcoin traded near $80,000, which was 35% below its October 2025 peak and 39% above its June 30 low.
What is Galaxy’s main risk metric for this bullish outlook?
Galaxy warns that a weekly close below the 50-week average (roughly $76,540) that is not reclaimed within a month would invalidate their view.
