#夏日创作营

Why I say Bitcoin is in the late stage of a bear market: volatility is down 50%, and dense “historical bottom” signals are appearing

Since July 2026, on-chain data and market structure have been rapidly releasing a key question: how much downside momentum does Bitcoin still have? On July 12, Real Vision’s chief analyst Jamie Coutts explicitly pointed out that a halving in volatility marks the market shifting from panic selling to bottoming and consolidation. When miners begin large-scale exits, the Fear and Greed Index falls to 11, yet ETF capital quietly returns—behind these seemingly contradictory phenomena, the contours of the late bear market are becoming increasingly clear.

Bitcoin’s current key data snapshot

Bitcoin drawdown vs. historical highs: about 50% (historical high: $126,100, October 2025)

Bear market length: 237 days, the fourth-longest in history

Largest drawdown in this cycle: only 53%, far lower than the prior three at 76%-84%

Volatility drop: down about 50% versus the previous cycle

More than 50% of supply is in unrealized losses: first triggered on June 5; in history, bottoms typically appear 10-101 days after this signal

Miner stress index: falls to the 2026 low, entering a historically undervalued zone

Spot ETF fund flows: ended 8 straight weeks of net outflows; last week recorded a net inflow of $197.4 million

Fidelity power-law model support: around $58,000-$60,000

Long-term analysts’ target price: rises to $200,000-$250,000 over the next 2-3 years

I. Volatility halving: the core signal that Bitcoin’s bear market is entering its tail end

Whether Bitcoin’s bear market has entered its later stage is often better indicated by the contraction in volatility than by price itself.

On July 12, Real Vision’s chief crypto analyst Jamie Coutts said Bitcoin’s current volatility is down about 50% versus the previous market cycle—an essential technical signal that the bear market is moving into its later phase. In his view, the current trend is “a typical ordinary bear market,” with Bitcoin down about 50% from its historical high of $126,100 in October 2025.

Using Glassnode data, as of July 3, 2026, Bitcoin’s 1-month annualized realized volatility was about 40.82%, and 3-month was 37.75%. Entering late June and early July, short-term implied volatility slid to the low-$30% range, while realized volatility hovered between 25% and 35%. A systematic contraction in volatility suggests the market is transitioning from a panic-selling phase to a bottoming and consolidation phase.

In my view, the key message conveyed by Bitcoin’s volatility halving is: extreme market sentiment is being cleared, not that the trend is deteriorating further. When volatility falls sharply from its peak, it often signals the exhaustion of downside momentum—not the start of another wave of catastrophic selling.

II. On-chain indicators resonate densely: multi-dimensional validation of Bitcoin’s bottom area

A single indicator can lead to misjudgment, but when multiple historically significant bottom signals appear at the same time, the market’s valuation logic deserves to be reconsidered.

MVRV

MVRV, the ratio of market value to realized value, is a core on-chain indicator for assessing whether Bitcoin’s valuation has bottomed. Bitcoin’s MVRV has compressed for four consecutive quarters, dropping from 2.185 in Q4 2025 to 1.130 at the start of Q3 2026. Bitcoin is currently only about 13% above the network’s aggregate cost basis. This is the moment when the network is closest to break-even since Q1 2023. From the cycle peak of 2.492, MVRV has compressed by 54.7%. Santiment data also shows Bitcoin’s 365-day MVRV is around -30%, meaning the average long-term holder is still in unrealized losses; historically, deep negative values more often appear during the long-term accumulation phase.

Long-term holder SOPR

Long-term holder SOPR, or Spent Output Profit Ratio, is also releasing bottoming signals.

We can see that BTC long-term holder SOPR fell to 0.615 on June 30, the lowest level since July 2023. This is the first time since July 2023 that the indicator has dropped below 1, suggesting long-term holders are selling at a loss. Historically, this is typically when they begin accumulating again. The last time SOPR fell below 1 was in October 2022, when Bitcoin’s trading price was close to $20,000—exactly the bottom area of the prior cycle.

Bitcoin miner capitulation/exit clearing

Miners also show classic late-stage bear market behavior. The 7-day moving average of Bitcoin’s total network hashrate fell from about 986 EH/s on July 1 to about 908 EH/s on July 11, a drop of about 7.9%. As a result, on July 11 the network adjusted mining difficulty down by 5% to 127.17 trillion. Miner exit has long been a hallmark event of late bear markets: weak miners are forced to shut down, and the industry completes the supply-side clearing.

When all three occur simultaneously—MVRV approaching historical lows, long-term holders beginning to sell at a loss, and miners exiting at scale—Bitcoin’s history shows this almost never points anywhere other than the bottom area. This isn’t optimistic self-soothing; it’s an objective fact presented by on-chain data.

III. Macro and sentiment resonance: the night before a final capitulation—or the eve of a reversal?

Bitcoin’s bottom is never a single point; it’s a range. The current market is deep within that range.

Bitcoin price structure

From the price structure, Bitcoin has been trading for about 5 months below the “Realized Market Average” ($766,000) and below the “Average Cost Basis of Short-term Holders” ($722,000). On July 1, Bitcoin closed weekly below the 200-week moving average for the first time since October 2023. The Fear and Greed Index briefly fell into the “extreme fear” range of 11 in early July.

We believe that when price breaks below key cost lines and long-term moving averages, it looks weak on the surface—but actually it’s the market completing the final sentiment clearing. Looking back across prior cycles, Bitcoin often forms its bottom in the most unloved positions. When most investors think “this time is different,” history suggests the pattern is actually more likely to play out.

Long-term holders vs. ETF contradiction

Long-term holders’ BTC amount has reached 16.75 million coins, a new historical high. Long-term holders’ realized market value is $836.4 billion, with an average holding cost around $50k. Also, according to Alphractal data, long-term holders now control about 84% of the total Bitcoin supply, while short-term holders’ supply proportion has fallen to the lowest level since 2016. Whales accumulated an additional roughly 270k BTC in the low-$59,000 area. After U.S. spot ETFs experienced a record net outflow of about $4.51 billion in June, the first week of July recorded a net inflow of $197 million, ending 8 straight weeks of capital outflow.

The contrarian accumulation by long-term holders and whales, along with the shift in ETF flows from a record outflow to a modest inflow, reveals a key fact: the moment when the market is most panicked is exactly when smart money is most active. Short-term holders hand over their chips to long-term holders. This wealth transfer process is itself one of the most typical features of the late bear market—and also the most important chip base for the next cycle.

Summary

Volatility halving, MVRV falling to cycle lows, miner capitulation/exit, and extreme fear—each time these signals have collectively appeared in Bitcoin’s history, they have corresponded to an important bottoming range.

This isn’t naive optimism guided by superstition; it’s an objective fact shown by on-chain data. The market may be only one macro catalyst away from a trend shift.