Bitcoin’s inability to hold above its key moving average near $83,000 in recent days has reignited market concerns about a new wave of sharp declines. However, a recent report from K33 Research points to significant differences between the current cycle and previous major downturns in Bitcoin’s history.
Tracking a different course from previous cycles
In the aftermath of similar price rejections in 2014, 2018, and 2022, Bitcoin historically rebounded strongly towards its 200-day moving average before quickly losing value again. During those periods, highly leveraged positions piled up, and an overly optimistic environment rapidly gave way to market crashes. According to K33 Research, this year’s trend stands in contrast, as neither a sudden rally nor a swift sell-off has occurred so far.
K33 Research’s chief analyst Vetle Lunde emphasized that the market has behaved much more cautiously this time, with most investor positioning in the derivatives market showing a generally pessimistic outlook.
A detailed review indicated that net funding rates in the derivatives market have stayed negative for 81 consecutive days, approaching a record in Bitcoin’s history. This pattern demonstrates that even when prices dropped to $60,000 in February, the dominant expectation among investors was for further declines.
ETF outflows and leveraged trading
On the CME Bitcoin futures exchange, the annualized basis recently dipped below 2.5%. The report highlights that such low levels typically reflect an environment of heightened caution. Additionally, open interest in both the options and futures markets remains elevated. As a result, should prices continue to weaken, market volatility could increase further.
There has also been a notable acceleration in outflows from US-based Bitcoin exchange-traded funds (ETFs). In the last five days alone, total outflows reached $1.6 billion, occurring as prices approached the critical $83,000 level. This price point aligns closely with the average cost basis for many Bitcoin ETF investors, which has seemingly prompted brisk selling each time the price nears this threshold.
Mini glossary: Open interest is the total number of active, unsettled contracts in the futures or options market. High open interest often makes the market more sensitive and volatile.
Market sentiment and outlook
K33 Research notes that, historically, when Bitcoin prices bounce back toward investors’ cost basis after a loss, selling tends to intensify. This familiar pattern appears to be re-emerging in the current market.
Nevertheless, K33’s internal indicators draw parallels between today’s conditions and the active market of March–April 2025. Back then, after the US imposed new import tariffs, the BTC price bottomed out and staged a robust recovery. The firm suggests that the drop to $60,000 in February may stand as the sharpest decline of the current cycle.
Vetle Lunde observes that the more moderate bull market of 2025 paved the way for a steadier bear market in 2026, reiterating that the February drop to $60,000 could prove to be the cycle’s steepest correction.
Comparing recent cycles and key market indicators
The table below offers a concise comparison of recent cycles and their primary indicators:
| Year | Post-decline Trend | Funding Rate | ETF Flows |
|---|---|---|---|
| 2014/2018/2022 | Rapid rebound followed by another sharp drop | Positive/Negative, volatile | No ETF / Limited |
| 2024-2025 | Slow and cautious, no abrupt rallies | Prolonged negative | Major outflows (1.6 billion dollars in 5 days) |
