Key Takeaways
- Bitcoin is in a market restructuring phase, not at a cycle top.
- Reduced leverage in futures markets signals healthier market dynamics.
- Limited supply and returning stablecoin liquidity support potential price recovery.
- Short-term range-bound movement is likely, but long-term bullish potential remains.
Bitcoin in a Restructuring Phase, Not a Cycle End
The Bitcoin market has faced turbulence in recent weeks, following October’s unexpected downturn. While some analysts have raised alarms about a possible end to the bull cycle, blockchain data suggests a different story. According to XWIN Research Japan, the flagship cryptocurrency is currently undergoing a market reset—a natural restructuring phase rather than a full-blown cycle exhaustion.
Also Read: Why Big Bitcoin Holders Are Crashing the Market — Again
Leverage Decline Signals Market Reset
XWIN Research pointed to a notable drop in open interest within the Bitcoin futures market since late October. This decline indicates that short-term traders are exiting leveraged positions, reducing market risk. Unlike previous cycle peaks—when leverage surged even at high prices—current market conditions show no such euphoric buildup. In essence, Bitcoin is shedding excess leverage, preparing for a healthier price trajectory rather than signaling a top.
Also Read: Bitcoin at $100K, Treasuries in Trouble: What Investors Must Know
The blockchain firm also highlighted declining U.S. institutional demand, reflected in the negative Coinbase Premium Index. This reduced momentum has kept Bitcoin relatively stable around $101,930, despite an 8% weekly decline. Structural support remains intact, reinforcing the notion that the market is in consolidation rather than collapse.
Signs of Resilience and Recovery
Even amid short-term weakness, several indicators point to Bitcoin’s resilience. Exchange reserves remain near multi-year lows, signaling limited supply available for sale. Additionally, stablecoin liquidity is gradually re-entering the market, suggesting that purchasing power is returning and investors are waiting for an opportune moment to buy.
While XWIN Research anticipates range-bound movement in the near term, these structural strengths imply that the cryptocurrency is positioned for potential upside once the market completes its reset.
