Underwear exposed! $BTC The institution's cost price is right here, falling below the entire network causing panic, but smart money has already started to buy the dip. Does the 2x potential still hold?

Market analysis indicates that, from macro and on-chain perspectives, $BTC 's valuation path in 2026 is undergoing adjustment. The target price for the second quarter has been lowered to $143k, but there is still about twice the potential upside from current levels. The logic is shifting from oversold to early equilibrium.

The macro environment still provides support, but momentum has slowed. Global M2 money supply reached a historical peak of approximately $13.44 trillion in February 2026. However, $BTC 's price has fallen about 27% from its Q1 high. Liquidity and price have diverged.

The divergence is due to the source of liquidity. Over the past year, more than 60% of M2 growth in the four major economies came from the Eastern superpower, thanks to its loose monetary policy. But trading restrictions on crypto assets in that country have made it difficult for this liquidity to effectively flow into the $BTC market. The dollar liquidity truly driving $BTC has been hindered by geopolitical conflicts.

The conflict at the end of February temporarily blocked the Strait of Hormuz, causing Brent crude oil prices to spike to $118 per barrel in March. This directly pushed up U.S. inflation, with the March CPI rising 3.3% year-over-year. The Federal Reserve’s rate cut path narrowed accordingly, with the March dot plot indicating possibly only one rate cut by 2026. However, the overall easing trend remained unchanged, and oil prices had significantly retreated by mid-April.

Institutional fund flows began to show positive signs. After several months of net outflows, $BTC spot ETFs turned positive in monthly net flows starting in March. By mid-April, cumulative inflows for the year had become positive. Meanwhile, in the week of April 13–19, listed company Strategy spent $2.54 billion to buy 34,164 BTC.

Overall, structural tailwinds remain, but geopolitical conflicts and slowing rate cuts form headwinds. Therefore, the macro impact score for Q2 was lowered from +25% in Q1 to +20%.

On-chain indicators show the market transitioning from undervaluation toward early equilibrium. Key metrics like MVRV-Z and NUPL have exited the panic zone from Q1. The average cost basis for short-term holders is moving downward, indicating profit-taking by speculators and accumulation of new funds at lower levels.

A key risk level is $54k, the network-wide average cost basis. Falling below this would cause many addresses to incur unrealized losses. The strongest resistance is at $78k, aligning with the long-term holders’ average entry cost. Currently, $BTC is around $70.5k, about 13% below that resistance. A decisive break above $78k would be an important signal of a short-term trend reversal.

Network activity shows a “surface prosperity, underlying stagnation” pattern. In the first half of April, daily transaction counts increased by 37.9% year-over-year, but active addresses decreased by 13.2%, and average transfer value per transaction dropped from 1.80 $BTC to 1.19 BTC. This suggests small, frequent operations by a few addresses rather than broad economic activity.

Expectations for $BTC 's DeFi ecosystem expansion have also weakened noticeably. Reports indicate that the total value locked (TVL) on Bitcoin’s layer-2 networks has fallen 74% year-to-date, and the entire ecosystem’s TVL accounts for only 0.46% of $BTC 's total supply. As a result, the fundamental score was lowered from 0% in Q1 to -10%.

Using valuation models based on early April’s average price, the neutral target is $132.5k. After adjusting for the -10% fundamental and +20% macro factors, the projected 12-month target price is $143k. This is about 23% lower than the Q1 target of $185.5k.

However, due to the significant retracement in spot prices, the actual upside potential from current levels has increased from 93% to 103%. The target price reduction does not imply bearishness; macro trends and on-chain structures still support a mid- to long-term bull market. Three short-term signals should be monitored: whether the price can break through the $78k key resistance, whether ETF fund flows can remain net inflows, and whether, after geopolitical risks ease, the Fed can accelerate policy shifts. If these conditions are met, the $143k target remains achievable.

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