Bitcoin Faces Potential 6 to 12 Month Bearish Phase Amid Weakening Liquidity and Whale Sell-Offs, Warns CryptoQuant CEO

• The current state of the cryptocurrency market is raising alarms, as experts signal a potential downturn for Bitcoin, often seen as the bellwether of crypto assets.

• As liquidity in the market appears to wane, caution begins to ripple through the investment community, reflecting on potential shifts in market dynamics.

• In Ju’s own words, “Sorry to change my view, but it now looks pretty clear that we’re entering a bear market,” underlining the urgency to reassess investment strategies.

Bitcoin faces bearish predictions as liquidity weakens and whales offload holdings, prompting experts to rethink the cryptocurrency’s future trajectory.

Ki Young Ju’s Bitcoin warning

In response to shifting market conditions, CryptoQuant CEO Ki Young Ju now vocalizes concerns over the sustainability of Bitcoin’s previous growth, stating that its bull run might have reached an end. His insights suggest that we are potentially facing a difficult period characterized by sideways price movement or a significant downturn.

Ju shared his warning on social media platform X, saying, “#Bitcoin bull cycle is over, expecting 6–12 months of bearish or sideways price action.”

Source: Ki Young Ju/X

What is exec’s reasoning?

Ju’s analysis stems from a comprehensive review of Bitcoin’s on-chain metrics, which indicate a lack of strong buying signals and point towards a potential bearish trend for the foreseeable future. The use of analytical tools like Principal Component Analysis (PCA) alongside indicators such as the MVRV, SOPR, and NUPL has illuminated concerning market behaviors.

He observed that liquidity inflows are diminishing and that newly minted whales (large holders) have begun liquidating their assets at declining price points, reinforcing fears of a bearish outlook.

Source: Ki Young Ju/X

Yet, some traders express skepticism, recalling that Ju’s previous predictions, such as a sell signal in 2020, did not play out as expected.

What’s more?

Ju pointed out another critical indicator: the diminishing levels of fresh liquidity. This decline is concerning, as liquidity drives market stability and price growth. The offloading behavior exhibited by recent whale investors at lower levels is often a precursor to bearish markets. This observation raises significant concerns regarding Bitcoin’s price prospects.

Moreover, the dwindling institutional demand is alarming. Negative ETF inflows persisting for three weeks indicate lower buying interest, thereby amplifying Bitcoin’s bearish sentiment. This consistent outflow suggests market participants may be losing faith in Bitcoin’s immediate resurgence.

Ju articulated his shift in sentiment, stating, “I can’t keep sharing just my hopes when the data keeps signaling bearish. I’m not going to short BTC and still hold my spot.”

Is there any hope?

Despite the prevailing bearish indicators, there remains historical precedent for Bitcoin’s recovery. An analysis of Bitcoin’s price behavior reveals a consistent seasonal trend whereby its most substantial gains typically occur between April and October. This trend raises questions about potential stabilization and a possible resurgence if history repeats itself.

Should this pattern continue, Bitcoin might find support in the coming months and be well poised to reclaim its previous all-time high by mid-2025. While short-term uncertainties loom large, the long-term outlook might still suggest considerable upside potential for Bitcoin compared to other cryptocurrencies.

Ultimately, the challenge remains whether Ju’s caution reflects genuine market conditions or if Bitcoin is gearing up for another surprise rally.

Conclusion

The current warnings from industry experts like Ki Young Ju highlight a critical juncture for Bitcoin, emphasizing a cautious approach in the face of weak liquidity and erratic whale behaviors. While the potential for a bearish climate exists, historical trends offer a glimmer of hope for recovery. Investors must remain vigilant and informed, continuously analyzing market indicators to navigate these turbulent waters effectively.