Key Takeaways
- • Galaxy Research believes bitcoin's bear market ended in June and that the asset has entered an accumulation phase, stating "We believe now is an attractive time to buy and hold bitcoin."
- • Bitcoin traded near $80,000 at the time of the note, about 35% below its October 2025 high and 39% above the June 30 low; a 53% rise would be needed to retake the previous record.
- • Galaxy counted 13 reclaims of the 50-week moving average since 2011; the four that ended spells of 20 weeks or more were higher a year later by 55% to 1,497%.
- • Asset managers' net long position in CME bitcoin futures fell 57% from the all-time high week, while 13F filings show nine major funds cut spot ETF holdings by a combined 68,000 BTC.
- • Galaxy's tripwire is a weekly close below the 50-week average (about $76,540) that is not regained within a month.
Summary
Galaxy Research believes bitcoin's bear market ended in June and that the asset has entered an accumulation phase, according to a research alert from the firm. At the time of the note, bitcoin traded near $80,000, about 35% below its October 2025 high and 39% above the June 30 low. The price would need to rise 53% to retake the previous record, while the S&P 500 sat within 1% of a record set on Oct. 6.
The report rests on four arguments. On technicals, Galaxy uses the 200-week moving average as a floor and the 50-week average as a ceiling in each bear market. Bitcoin lost the 50-week average in November 2025 and stayed below it for 44 weeks. The June low tested the 200-week average and held, with the worst weekly close 4.7% beneath it. The week ended Oct. 18 was the fifth consecutive weekly close above the 50-week average. Galaxy counted 13 such reclaims since 2011; the four that ended spells of 20 weeks or more were higher a year later by between 55% and 1,497%, and none closed more than 8.4% below the reclaim level in the following 12 months. Of the nine that ended shorter spells, seven fell more than 25% within a year.
On the halving cycle, prior cycles bottomed on days 777, 889 and 912 after their halvings, and Oct. 22 was day 916 of the current cycle. Galaxy said gains after those lows (87x, 19x and 7.6x) have shrunk each cycle and that it does not forecast a repeat. The current 53% drawdown is the shallowest in bitcoin's history, and the first in which price did not fall below the network's realized cost basis.
On positioning, the report identifies basis traders and macro funds as the main sellers since the top. Per Commodity Futures Trading Commission data cited by Galaxy, asset managers' net long position in CME bitcoin futures fell 57% from the all-time high week. The front-month basis averaged 7.9% annualized in the 30 days before the high and 4.8% in the 30 days to Oct. 21, which the firm said no longer covers the trade's costs and risk. Based on 13F filings, Millennium Management, Brevan Howard, Goldman Sachs, Capula, Farallon, D. E. Shaw, Schonfeld, Symmetry and Tudor cut spot ETF holdings by 29% to 100% between the September 2025 and June 2026 quarter-ends, a combined 68,000 BTC. Total holdings across all 2,200 filers fell by 48,000 BTC, meaning remaining institutions added in aggregate; Morgan Stanley's wealth management arm, Mubadala and the Abu Dhabi Investment Council were among the buyers. Spot ETF holdings dropped 11% from peak to trough while price fell 53%, and funds have added 87,000 BTC since the June low.
Galaxy's fundamental case centers on U.S. fiscal conditions. Federal debt reached $40.44 trillion on Oct. 20, fiscal 2026 ended with a $1.99 trillion deficit, and the 10-year Treasury yield hit 5.31% on Oct. 5, its highest since 2007. The firm argued that refinancing that debt at 5% while running 6% deficits creates pressure to inflate, and it described AI-related borrowing, which Morgan Stanley expects to reach $570 billion this year, as contributing to that pressure. On sentiment, Galaxy compared the environment to 2015–16 and 2018–19, when mainstream finance embraced "blockchain" and dismissed bitcoin, and said the 2026 version is "stablecoins and tokenization, not bitcoin," citing bank tokenized-deposit pilots, the Senate's failed cloture vote on the Clarity Act on Sept. 15, and multiyear lows in Google searches for "bitcoin."
Galaxy's tripwire is a weekly close below the 50-week average, about $76,540, not regained within a month. The firm cited AI-enabled theft, including the $387.5 million Bitget exploit, while noting none involved the Bitcoin protocol itself. On quantum risk, the report said 7.1 million BTC sit in outputs with exposed public keys, though no cryptographically relevant quantum computer exists, and pointed to BIP-360's merge into the BIP repository in February and Galaxy's own $5 million quantum readiness commitment.
The report rests on four arguments. On technicals, Galaxy uses the 200-week moving average as a floor and the 50-week average as a ceiling in each bear market. Bitcoin lost the 50-week average in November 2025 and stayed below it for 44 weeks. The June low tested the 200-week average and held, with the worst weekly close 4.7% beneath it. The week ended Oct. 18 was the fifth consecutive weekly close above the 50-week average. Galaxy counted 13 such reclaims since 2011; the four that ended spells of 20 weeks or more were higher a year later by between 55% and 1,497%, and none closed more than 8.4% below the reclaim level in the following 12 months. Of the nine that ended shorter spells, seven fell more than 25% within a year.
On the halving cycle, prior cycles bottomed on days 777, 889 and 912 after their halvings, and Oct. 22 was day 916 of the current cycle. Galaxy said gains after those lows (87x, 19x and 7.6x) have shrunk each cycle and that it does not forecast a repeat. The current 53% drawdown is the shallowest in bitcoin's history, and the first in which price did not fall below the network's realized cost basis.
On positioning, the report identifies basis traders and macro funds as the main sellers since the top. Per Commodity Futures Trading Commission data cited by Galaxy, asset managers' net long position in CME bitcoin futures fell 57% from the all-time high week. The front-month basis averaged 7.9% annualized in the 30 days before the high and 4.8% in the 30 days to Oct. 21, which the firm said no longer covers the trade's costs and risk. Based on 13F filings, Millennium Management, Brevan Howard, Goldman Sachs, Capula, Farallon, D. E. Shaw, Schonfeld, Symmetry and Tudor cut spot ETF holdings by 29% to 100% between the September 2025 and June 2026 quarter-ends, a combined 68,000 BTC. Total holdings across all 2,200 filers fell by 48,000 BTC, meaning remaining institutions added in aggregate; Morgan Stanley's wealth management arm, Mubadala and the Abu Dhabi Investment Council were among the buyers. Spot ETF holdings dropped 11% from peak to trough while price fell 53%, and funds have added 87,000 BTC since the June low.
Galaxy's fundamental case centers on U.S. fiscal conditions. Federal debt reached $40.44 trillion on Oct. 20, fiscal 2026 ended with a $1.99 trillion deficit, and the 10-year Treasury yield hit 5.31% on Oct. 5, its highest since 2007. The firm argued that refinancing that debt at 5% while running 6% deficits creates pressure to inflate, and it described AI-related borrowing, which Morgan Stanley expects to reach $570 billion this year, as contributing to that pressure. On sentiment, Galaxy compared the environment to 2015–16 and 2018–19, when mainstream finance embraced "blockchain" and dismissed bitcoin, and said the 2026 version is "stablecoins and tokenization, not bitcoin," citing bank tokenized-deposit pilots, the Senate's failed cloture vote on the Clarity Act on Sept. 15, and multiyear lows in Google searches for "bitcoin."
Galaxy's tripwire is a weekly close below the 50-week average, about $76,540, not regained within a month. The firm cited AI-enabled theft, including the $387.5 million Bitget exploit, while noting none involved the Bitcoin protocol itself. On quantum risk, the report said 7.1 million BTC sit in outputs with exposed public keys, though no cryptographically relevant quantum computer exists, and pointed to BIP-360's merge into the BIP repository in February and Galaxy's own $5 million quantum readiness commitment.
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