Bitcoin has dropped sharply after hitting an all-time high in October. A recent report from CryptoQuant indicates that BTC has officially entered a bear market and warns that the demand zone may allow prices to drop to $56,000. However, Simon Dedic, a partner at Moonrock Capital, takes a long-term view, believing that the crypto market is now in a similar late stage of a 'dot-com bubble', presenting unprecedented investment opportunities.
CryptoQuant Report: ETF Outflow Exposes BTC Demand Gap
ETF Inflow Reversal
CryptoQuant data shows that the U.S. Bitcoin spot ETF has reduced its holdings by approximately 24,000 BTC (about $2.1 billion) in the fourth quarter of 2025, ending a year-long trend of accumulation.
SoSoValue data
This is of great symbolic significance for the market, given that ETFs are the biggest drivers of this bull market, and are now becoming net sellers. Therefore, weak demand for ETFs can serve as an important signal that the overall market structure is cooling down.
Large holders are no longer buying the dips.
At the same time, addresses holding 100 to 1,000 BTC are also the main demand drivers from past bullish cycles, including ETFs, corporations, and other individual entities.
However, CryptoQuant points out that the growth rate of this group is below the long-term trend, very similar to the end of 2021, when weak demand also triggered the bear market of 2022.
(10x Research Outlook 2026: Bitcoin has entered a bear market, with liquidity and election cycles as key variables)
BTC broke below the 365-day moving average
Bitcoin recently fell to around $88,000, down 30% from the historical high in October, symbolizing the break below the 365-day moving average. CryptoQuant believes this is the most reliable 'bull-bear dividing line' in past cycles.
The report estimates that this cycle's low point may fall around $56,000, while around $70,000 is seen as intermediate support.
Simon Dedic seeks opportunities from the fog: the next few years may be the best investment window.
Moonrock Capital partner Simon Dedic takes a longer-term view, believing that cryptocurrencies are currently in the phase following the internet bubble burst two decades ago.
After the 2000 internet bubble burst, the long-term trends of the Nasdaq market and the number of global internet users show that Bitcoin ≠ altcoins ≠ crypto market
Dedic first emphasized that Bitcoin should not be confused with altcoins; neither can represent the entire crypto market, just like 'gold and tech stocks' in the early 2000s cannot and should not be interpreted on the same line:
This explains why Bitcoin has performed relatively well, while many of the best cryptocurrency projects are facing the most severe bear market in history.
Crypto is experiencing the 'post-bubble phase': it burst in 2021.
Dedic believes that the market took 15 years to reach new highs after the internet bubble, and we are likely to see a similar recovery pattern in the crypto market: 'I believe the crypto market's internet bubble burst back in 2021.'
As the speed of new technology adoption accelerates and market cycles are clearly compressed, cryptocurrencies may only need 5 to 10 years to flourish. Considering that it is now 2025, the most painful phase may have already passed.
The more desperate, the closer to opportunity: is a generational investment opportunity emerging?
Given that the crypto community is filled with pessimism and apocalyptic feelings, Dedic believes that now is the best time to seek 'generational opportunities.'
He pointed out that the valuations and speculation of the previous bull market have completely detached from reality, and the current reshuffling and collapse are allowing the industry to return to true business models and value construction:
Looking back at the painful yet growth-oriented years from 2000 to 2007, it gave rise to companies like Amazon and Google. They transformed from the scams that people talked about at the time to the most valuable companies in the world, yielding returns of 100 times or even 1000 times.
He emphasized: 'This is what a generational investment opportunity looks like; it is neither obvious nor comfortable for everyone, but this is the best time.'
(Is the 'iPhone moment' for cryptocurrencies coming? Venture capitalists and traders unveil the investment rules for crypto in the next decade)
This article looks at Bitcoin's bear market from CryptoQuant data: the cryptocurrency bubble burst back in 2021, first appearing in Chain News ABMedia.
