Galaxy Digital research lead Alex Thorn warns Bitcoin may keep sliding because there are few catalysts to reverse its trend. In a recent note he said there’s a “significant chance” BTC could drop to the bottom of a supply gap near $70,000 and potentially test its realized price around $56,000 (the average cost of all circulating BTC).
Thorn noted narratives are working against Bitcoin: it has failed to move with gold and silver as part of a market-wide “debasement hedge” trade, and meaningful positive catalysts are scarce. Bitcoin rose about 3% to trade near $78,500 after recovering from a nine-month low but remains roughly 39% below its early-October all-time high above $126,000.
Historically, Bitcoin has traded below its realized price at prior cycle bottoms and typically found support around or slightly below that level before recovering. It has also found key support at the 200-week moving average during past cycles when it fell below the 50-week moving average. Bitcoin lost support at the 50-week MA in November; the 200-week MA currently sits around $58,000 — levels that have previously marked cycle bottoms and buying opportunities for long-term investors.
On demand dynamics, Thorn says there’s little evidence of significant accumulation by large buyers and long-term holders, which could pressure price as potential buyers wait for lower levels. At the same time, long-term holder profit-taking has “begun to notably abate,” a development that could indicate the market is nearing a bottom, though some holders may still wait for higher prices to sell, which can cap gains.
A U.S. crypto market-structure bill being considered in the Senate could act as an exogenous catalyst if passed, but Thorn says the odds of passage have declined recently amid fading bipartisan momentum and delays in committee action. He adds any positive effect from such legislation would likely benefit altcoins more than Bitcoin.
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