Key Takeaways
- • Galaxy Research concluded that bitcoin's bear market ended last June and that the asset has entered an accumulation phase, calling it "an attractive time to buy and hold bitcoin" in a report cited by Bitcoin Magazine on Oct. 26.
- • Bitcoin traded near $80,000 at the time of the report, about 35% below its October 2025 peak, 39% above its June 30 low, and needs roughly 53% more to regain the record high.
- • Technical recovery: bitcoin regained its 50-week moving average in September and closed above it for five straight weeks through Oct. 18, after holding the 200-week moving average at the June low.
- • Institutional selling pressure is easing: CFTC data show asset managers' net long positions in CME bitcoin futures fell 57% from the record-high week, while annualised arbitrage yield dropped to 4.8% from 7.9%.
- • Galaxy flagged macro and sentiment risks, including U.S. federal debt of $40.44 trillion, a fiscal 2026 deficit of $1.99 trillion, a 10-year Treasury yield peak of 5.31% on Oct. 5, and a shift in interest toward stablecoins and tokenisation over bitcoin.
Summary
Galaxy Research has concluded that bitcoin's bear market ended last June and that the asset has now entered an accumulation phase, according to a report reported by Bitcoin Magazine on Oct. 26 (local time). In the report, Galaxy stated, "Now is an attractive time to buy and hold bitcoin." At the time the report was written, bitcoin was trading near $80,000, about 35% below its October 2025 peak but 39% above its June 30 low. Reaching the previous record high would require a further rise of roughly 53%.
Galaxy based its view on four factors: technical indicators, market positioning, the U.S. fiscal situation and investor sentiment. On technicals, bitcoin fell below its 50-week moving average in November 2025 and remained under it for 44 weeks. It held the 200-week moving average at the June low, regained the 50-week average in September, and closed above that line for five consecutive weeks through the week ended Oct. 18. Galaxy noted that of 13 recovery cases since 2011, the four in which bitcoin stayed below the moving average for 20 weeks or more rose 55% to 1,497% a year later. The current drawdown of 53% was the smallest among past cycles, and Oct. 22, the 916th day after the halving, was beyond the 777 to 912 day range that marked bottoms in the three previous cycles.
On positioning, U.S. Commodity Futures Trading Commission data showed asset managers' net long position in CME bitcoin futures fell 57% from the week of the record-high print, and the annualised arbitrage yield using spot ETFs and futures dropped to 4.8% from 7.9%. Galaxy also cited 13F filings showing nine institutions cut spot ETF holdings by a combined 68,000 BTC between the end of September 2025 and the end of June 2026. Holdings across 2,200 reporting institutions fell by only 48,000 BTC, which Galaxy interpreted as remaining institutions being net buyers overall. Spot ETF holdings were down 11% from the peak, but 87,000 BTC flowed back in after the June low.
On fiscal conditions, U.S. federal debt stood at $40.44 trillion as of Oct. 20, and the fiscal 2026 deficit was $1.99 trillion. The 10-year Treasury yield reached 5.31% on Oct. 5, its highest since 2007. Galaxy analysed that inflation pressure could build if the government refinances debt at 5% rates while running a deficit equal to 6% of GDP, and it cited Morgan Stanley's forecast of $570 billion in AI-related borrowing this year as an additional strain.
On sentiment, Galaxy compared current conditions with bottom-formation periods in 2015 to 2016 and 2018 to 2019, when financial institutions showed interest in blockchain but were sceptical of bitcoin. It said interest is again tilting toward stablecoins and tokenisation, citing banks' tokenised deposit experiments, the U.S. Senate's Sept. 15 rejection of a cloture motion on the Clarity Act, and bitcoin search volume at multi-year lows. Galaxy said its optimism should be reconsidered if bitcoin posts a weekly close below its 50-week moving average of about $76,540 and fails to recover within a month. The report also referenced the $387.5 million Bitget hack and quantum computing risk, noting that no quantum computer currently can decrypt bitcoin's encryption, and said Galaxy would invest $5 million to prepare for quantum computing.
Galaxy based its view on four factors: technical indicators, market positioning, the U.S. fiscal situation and investor sentiment. On technicals, bitcoin fell below its 50-week moving average in November 2025 and remained under it for 44 weeks. It held the 200-week moving average at the June low, regained the 50-week average in September, and closed above that line for five consecutive weeks through the week ended Oct. 18. Galaxy noted that of 13 recovery cases since 2011, the four in which bitcoin stayed below the moving average for 20 weeks or more rose 55% to 1,497% a year later. The current drawdown of 53% was the smallest among past cycles, and Oct. 22, the 916th day after the halving, was beyond the 777 to 912 day range that marked bottoms in the three previous cycles.
On positioning, U.S. Commodity Futures Trading Commission data showed asset managers' net long position in CME bitcoin futures fell 57% from the week of the record-high print, and the annualised arbitrage yield using spot ETFs and futures dropped to 4.8% from 7.9%. Galaxy also cited 13F filings showing nine institutions cut spot ETF holdings by a combined 68,000 BTC between the end of September 2025 and the end of June 2026. Holdings across 2,200 reporting institutions fell by only 48,000 BTC, which Galaxy interpreted as remaining institutions being net buyers overall. Spot ETF holdings were down 11% from the peak, but 87,000 BTC flowed back in after the June low.
On fiscal conditions, U.S. federal debt stood at $40.44 trillion as of Oct. 20, and the fiscal 2026 deficit was $1.99 trillion. The 10-year Treasury yield reached 5.31% on Oct. 5, its highest since 2007. Galaxy analysed that inflation pressure could build if the government refinances debt at 5% rates while running a deficit equal to 6% of GDP, and it cited Morgan Stanley's forecast of $570 billion in AI-related borrowing this year as an additional strain.
On sentiment, Galaxy compared current conditions with bottom-formation periods in 2015 to 2016 and 2018 to 2019, when financial institutions showed interest in blockchain but were sceptical of bitcoin. It said interest is again tilting toward stablecoins and tokenisation, citing banks' tokenised deposit experiments, the U.S. Senate's Sept. 15 rejection of a cloture motion on the Clarity Act, and bitcoin search volume at multi-year lows. Galaxy said its optimism should be reconsidered if bitcoin posts a weekly close below its 50-week moving average of about $76,540 and fails to recover within a month. The report also referenced the $387.5 million Bitget hack and quantum computing risk, noting that no quantum computer currently can decrypt bitcoin's encryption, and said Galaxy would invest $5 million to prepare for quantum computing.
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