Bitcoin Bull Score Reset: Long-Term Consolidation Expectation

Bitcoin's (BTC) Bull Score has dropped to zero for the first time since 2020, indicating a significant weakening of market strength. CryptoQuant analysts emphasize that the Bitcoin Bull Score's decline to zero last occurred in January 2020, during the pre-pandemic bottom process. However, given the current market dynamics, this situation may carry a different meaning compared to previous instances.

Analysts suggest that the current zeroing out may represent a period of fatigue in an extended bull cycle. The report reveals that all 10 on-chain indicators (MVRV, ETF inflows, stablecoin liquidity, demand growth, trader margins, etc.) among Bitcoin's fundamental indicators are trending downwards. Particularly, in a period where ETF and institutional fund inflows have slowed, the continued selling by long-term holders (LTH) reinforces the market's weakness. At this point, it is noteworthy that stablecoin liquidity has also diminished.

CryptoQuant analysts state that the current momentum is more likely a temporary strengthening due to supply constraints rather than a new surge in demand. One of the prominent questions is how the bull trend can be restored. In this context, it is noted that ETF inflows need to increase again, liquidity growth must accelerate, and long-term investors should resume accumulation. Otherwise, Bitcoin's price is expected to enter a prolonged consolidation process.

Historically, periods when the Bull Score has reached zero have signaled major market bottoms (2020, 2022) and distribution phases at the end of bull cycles. However, CryptoQuant analysts suggest that a late bull/early bear transition may be more likely this time. Factors that investors should monitor include increases in ETF inflows, growth in market liquidity, and renewed buying by long-term investors.