CryptoQuant and Santiment See Signs of Bitcoin's Local Bottom Approaching

Analytical platforms CryptoQuant and Santiment have pointed to signs that may indicate the approach of a local bottom for Bitcoin. The former drew attention to a historical pattern in the behavior of long-term holders, while the latter noted a decrease in the number of wallets with a non-zero balance.

Early stage of a bullish cycle

According to CryptoQuant's observations, in previous cycles, large-scale Bitcoin rallies began after the share of Bitcoins in circulation for more than 18 months first increased and then began to decline. Currently, analysts estimate that the market is in the early stage of a bullish cycle, and the corresponding signal has not yet begun to form. This may indicate that the potential for further growth remains significant, and the rally could be prolonged.

An additional argument cited by analysts is the weak interest of the general public in cryptocurrencies: even among those who follow the market, many are not yet rushing to invest. According to CryptoQuant, this suggests that the market is not yet overheated, and the main growth phase may still be ahead.

Wallets and retail capitulation

According to Santiment, since October 16, the number of non-zero Bitcoin wallets has decreased by approximately 30,000, and the total figure has once again approached 59.95 million. Analysts explained the dynamics as possible disappointment among small holders after a prolonged price stagnation. However, the reduction in the number of wallets does not necessarily indicate a deterioration in the network's utility.

Santiment noted that the capitulation of retail investors historically could create more favorable conditions for further growth than the influx of new buyers amid a rapid price increase: participants who have lost patience exit the market, and the expectations of the majority become overly pessimistic.

Key level

Analysts have identified $80,000 as a key level where the battle between buyers and sellers is currently unfolding. If the number of non-zero wallets continues to decrease and Bitcoin holds above $80,000, recovering to around $82,500, it will strengthen the contrarian signal of a possible formation of a local bottom. A sustained drop below the recent $79,000 zone will weaken this scenario and indicate that investor capitulation may continue.

Earlier, Galaxy Digital announced the end of Bitcoin's bearish cycle.