Bitcoin’s Combined Market Index (BCMI) has fallen to the 0.2 range, raising new concerns over deeper structural weakness. This metric now mirrors conditions seen during previous early bear market phases, suggesting that the current decline may be more than a routine correction.
As of February 12, Bitcoin continues to trade nearly 18% above its realized price of approximately $55,000. Historically, cycle bottoms occurred when the price dropped 24–30% below this level, followed by long sideways periods before any sustained recovery.
Bitcoin BCMI Shows Deeper Market Breakdown
The BCMI aggregates four on-chain metrics: MVRV, NUPL, SOPR, and sentiment to capture the broader state of market health. A reading in the low 0.2 range reflects shrinking unrealized profits, rising realized losses, and broad sentiment deterioration.
Source: CryptoQuant
In October 2025, the index held around 0.5, considered a mid-cycle equilibrium. However, recent behavior shows a direct decline from that level through 0.3 and down to 0.2, without the recovery patterns seen in past mid-cycle slowdowns. This trajectory aligns more closely with bear market entry phases recorded in 2018 and 2022.
“From a cycle perspective, true bottom conditions may still be ahead,” said CryptoQuant in a February 12 report. The platform added that without a rebound toward the 0.4–0.5 range, continued structural weakness is likely.
BTC Losses Mount, But Realized Price Support Untested
On February 5, Bitcoin holders recorded $5.4 billion in realized daily losses—the largest since March 2023. Despite this, cumulative losses remain modest compared to past cycles. For example, monthly losses in BTC terms are currently at 0.3 million BTC, far below the 1.1 million BTC seen during the late 2022 washout.
Additionally, several key valuation metrics have not yet reached historical capitulation zones. MVRV remains above the extreme undervalued range, and NUPL has not fallen to the ~20% unrealized loss level typically seen at bottoms. At present, 55% of Bitcoin’s circulating supply remains in profit. Prior cycle lows occurred when this number dropped closer to 45–50%.
Source: CryptoQuant
Long-term holders also show resilience. While selling is happening near breakeven, this differs from the 30–40% losses these holders typically endure during bear market lows. CryptoQuant notes that such conditions suggest that a full reset may still require further downside.
Concurrently, Bitcoin’s realized price of $55,000 has historically served as a foundation during bear market lows. During past cycles, the price often dropped 25% below this level and then moved sideways for several months before recovery began. Today, the price remains about 18% above that line, indicating that full bottoming behavior has not yet developed.
CryptoQuant’s Bull-Bear Cycle Indicator also shows the market is still in the Bear Phase, not yet in the Extreme Bear Phase that typically precedes long-term recoveries.
Bitcoin Funding Rates Signal Crowded Short Trade
As bearish sentiment builds, traders have opened an increasing number of short positions. Santiment data shows that aggregated funding rates across major exchanges have fallen to their most negative levels since August 2024. At that time, the market reversed sharply after widespread short liquidation.
Extreme negative funding rates indicate that a large portion of traders are betting on continued downside. If the price rises unexpectedly, forced buying from short liquidations can cause fast upward moves. However, Santiment warned that this setup does not guarantee an immediate rally, only that the risk of volatility is increasing.
Source: Santiment
“The market is now positioned in a way where a move higher could lead to rapid liquidations,” said Santiment analysts. “But without a trigger, the pressure may continue building.”
During this period of uncertainty, the Royal Government of Bhutan has reduced its Bitcoin holdings again, lowering its stash to 5,600 BTC amid price weakness. Concurrently, Standard Chartered has also cut its Bitcoin forecast, aligning with CryptoQuant, and warned of further downside toward $50,000 in the coming months. At press time, the Bitcoin price was trading at $65,550, a 2.35% decline from the 24-hour high.
