CryptoQuant: The bear market may have begun, with a mid-term support level estimated at $70,000

On December 20, CryptoQuant, an on-chain analysis company, released a report stating that Bitcoin demand growth has significantly slowed, potentially signaling an upcoming bear market. Since 2023, Bitcoin has experienced three major spot demand waves—driven by the launch of US spot ETFs, the US presidential election results, and the Bitcoin treasury company bubble—but since early October 2025, demand growth has fallen below trend levels. This indicates that most of the new demand in this cycle has already been realized, and the key support pillars for prices have disappeared.

On the other hand, the derivatives market also confirms a weakening risk appetite: the funding rate of perpetual futures (365-day moving average) has fallen to its lowest level since December 2023. Historically, this decline reflects a reduced willingness to maintain long positions, a pattern typically seen in bear markets rather than bull markets.

From a technical perspective, the price structure has deteriorated with weakening demand: Bitcoin has broken below its 365-day moving average, a critical long-term technical support level that has historically marked the boundary between bull and bear markets. However, the downside reference point suggests a relatively small bear market decline: based on historical data, Bitcoin’s bear market bottom is roughly aligned with its realized price, currently near $56,000, implying a retracement of up to 55% from recent all-time highs—this is the smallest decline ever.

Mid-term support is expected around $70,000.