Galaxy Research Declares Bitcoin Bear Market Over and Enters Accumulation Phase

Galaxy Research believes bitcoin’s bear market came to a close in June and that the cryptocurrency is now in an accumulation period, the firm said in a research alert. “We believe now is an attractive time to buy and hold bitcoin,” the report stated.

At the time the note was published, bitcoin was changing hands near $80,000, roughly 35% under the peak reached in October 2025 and 39% higher than the June 30 low. A 53% gain would be required for the price to reclaim its former record. The S&P 500, meanwhile, is less than 1% below a record established on Oct. 6.

Galaxy organized its case around four areas: technicals, positioning, fundamentals and sentiment.

Bitcoin technical view

To identify bitcoin bear markets, Galaxy tracks two weekly moving averages. The firm says the 200-week average has served as a floor in every downturn, while the 50-week average has acted as a ceiling.

Bitcoin fell under the 50-week average in November 2025 and remained beneath that line for 44 weeks. The low in June tested the 200-week average and held; the weakest weekly close was 4.7% below it. In September the price moved back above the 50-week average, and the week that ended Oct. 18 marked a fifth straight weekly close above it.

Since 2011, Galaxy has counted 13 instances of that kind, and it said the result hinged on the length of time price had stayed under the average. When a reclaim brought a stretch of 20 weeks or longer to an end, the four cases all traded higher a year later, with gains ranging from 55% to 1,497%, and none finished more than 8.4% beneath the reclaim level in the next 12 months. Among the nine reclaims that ended shorter stretches, seven dropped more than 25% within a year.

The halving cycle, in the firm's view, points the same way. Earlier cycles found their lows on days 777, 889 and 912 after the respective halvings. The current cycle reached day 916 on Oct. 22. The rallies that came after those troughs — 87x, 19x and 7.6x — have gotten smaller with each cycle, and Galaxy says it is not predicting another such move.

The 53% drawdown now under way is the mildest on record for bitcoin, the report said, and the first decline that never took price beneath the network's realized cost basis.

Positioning data

Basis traders and macro funds were the primary sellers after the peak, according to the report. Commodity Futures Trading Commission data cited by Galaxy shows asset managers' net long position in CME bitcoin futures down 57% from the week when the all-time high was set.

The net short position held by leveraged funds — the futures side of the cash-and-carry strategy paired with spot ETFs — contracted by roughly the same degree. Front-month basis ran at an average annualized 7.9% during the 30 days before the peak and 4.8% in the 30 days through Oct. 21, a level Galaxy says is insufficient to compensate for the trade's costs and risk.

To name the sellers, Galaxy looked at 13F filings. Millennium Management, Brevan Howard, Goldman Sachs, Capula, Farallon, D. E. Shaw, Schonfeld, Symmetry and Tudor each reduced their spot ETF positions by 29% to 100% between the September 2025 and June 2026 quarter-ends, totaling 68,000 BTC.

Total holdings across all 2,200 filers declined by only 48,000 BTC, implying the rest of the institutions added positions on a net basis. Buyers included Morgan Stanley's wealth management arm, Mubadala and the Abu Dhabi Investment Council.

From top to bottom, spot ETF holdings slipped 11% while the price lost 53%, and those funds have accumulated 87,000 BTC since the June low, per the report.

Fundamentals and market sentiment

U.S. fiscal conditions sit at the heart of Galaxy's fundamental argument. Federal debt touched $40.44 trillion on Oct. 20, fiscal 2026 closed with a deficit of $1.99 trillion, and the 10-year Treasury yielded 5.31% on Oct. 5 — the most since 2007.

When a government must refinance that debt at 5% while deficits run at 6%, the incentive to inflate is strong, the firm argued.

AI-related borrowing, forecast by Morgan Stanley to hit $570 billion this year, adds to that pressure rather than competing for capital, the report said.

Galaxy drew a comparison between today's sentiment and 2015–16 and 2018–19, eras when mainstream finance warmed to “blockchain” while writing off bitcoin. Those stretches lined up with cycle bottoms. The 2026 equivalent, the firm says, is “stablecoins and tokenization, not bitcoin,” citing banks testing tokenized deposits, the Senate's failed cloture vote on the Clarity Act on Sept. 15, and Google search interest in “bitcoin” sitting at multiyear lows.

Risks to the outlook

Galaxy attached a tripwire to its outlook: a weekly close under the 50-week average — roughly $76,540 — that is not recovered within a month. It also flagged AI-enabled theft, among them the $387.5 million Bitget exploit, while pointing out that none of those incidents touched the Bitcoin protocol itself.

As for quantum computing, the report noted that 7.1 million BTC are held in outputs with exposed public keys, yet no cryptographically relevant quantum computer has been built. It cited BIP-360's merge into the BIP repository in February and Galaxy's own $5 million commitment to quantum readiness.