Is Bitcoin's Next Bull Market on the Horizon?

Market Readiness: On-Chain Metrics Signal a Bullish Setup

Bitcoin's on-chain metrics in Q3 2025 paint a picture of a market primed for a bull cycle. After reaching an all-time high of $112,000 in May 2025, Bitcoin entered a consolidation phase, trading within a $100,000–$110,000 range. However, key indicators suggest this period was a healthy correction rather than a bearish reversal. The MVRV Z-Score, which measures the ratio of realized to market value, rebounded from a low of 1.43 to a neutral range, indicating reduced overhang from profit-taking by short-term holders, according to Bitcoin Magazine. Simultaneously, the Value Days Destroyed (VDD) Multiple entered a "green zone," signaling strong long-term holder (LTH) accumulation and reduced selling pressure, as shown in an XT.com analysis.

Wallet distribution data further reinforces this narrative. Over 70% of Bitcoin's circulating supply has remained unmoved for over a year, with 74% considered illiquid (not moved in ≥2 years), according to a Glassnode report. This hoarding behavior, combined with a SOPR (Spent Output Profit Ratio) of 1.03-just above break-even-suggests minimal short-term selling pressure and a tightening float, as the Glassnode report also notes. Whale activity also shows a growing trend of accumulation, with addresses holding over $10 million in BTC increasing by 4.23% in mid-2025, according to Phemex. These metrics collectively point to a market where patient capital is dominating, setting the stage for a potential breakout.

Macroeconomic Catalysts: Dovish Policy and Liquidity Expansion

The Federal Reserve's dovish pivot in September 2025 has been a critical catalyst. A 25-basis-point rate cut brought the federal funds rate to 4.00%–4.25%, with the Fed signaling two additional cuts by year-end, as reported by AP News. This easing of monetary policy has fueled a "debasement trade," where investors seek assets that outpace inflation and currency devaluation. Bitcoin, historically correlated with global M2 money supply expansion, has benefited from this dynamic. The U.S. M2 money supply alone reached $22.195 trillion in September 2025, reflecting a broader liquidity surge, according to Gate.io. While Bitcoin's price does not always move in lockstep with M2, historical data shows it lags liquidity changes by approximately 56–60 days, as documented by Bitcoin Magazine Pro. This lag suggests that Bitcoin's next leg higher could materialize as liquidity expansion continues into Q4.

Inflationary pressures, though easing, remain above the Fed's 2% target, with the U.S. annual inflation rate at 2.9% in August 2025, according to The World Data. Bitcoin's role as a hedge against debasement has gained traction, particularly as institutional investors allocate to crypto through ETFs and corporate treasuries. For example, MicroStrategy's continued BTC accumulation and the launch of U.S. 401(k) Bitcoin investment options in August 2025 have unlocked access to an $8.9 trillion capital pool, notes CryptoRank.

Institutional Adoption and Regulatory Clarity

Regulatory clarity has further solidified Bitcoin's bull case. The passage of the GENIUS Act in 2025 established a comprehensive framework for stablecoins, while the SEC's approval of generic listing standards for crypto ETFs has spurred institutional adoption, according to Nasdaq. U.S. spot Bitcoin ETFs have attracted over $55 billion in inflows year-to-date through Q3 2025, with exchange-held supply declining as investors move BTC to cold storage, per Aurpay.

Institutional participation is also evident in Bitcoin's transaction dynamics. The average transaction count has declined, while the value per transaction has risen, reflecting a shift from retail-driven "small-frequent" activity to institutional "large-infrequent" transactions, according to a CoinGecko report. This structural change aligns with Bitcoin's transition from speculative retail adoption to a cornerstone of institutional portfolios.

Conclusion: A Bull Market on the Horizon

The confluence of on-chain strength, macroeconomic tailwinds, and regulatory progress suggests Bitcoin's next bull market is not only on the horizon but already unfolding. While short-term volatility remains a risk-particularly from equity market corrections or Trump-era tariff-driven inflation-the fundamentals are robust. Institutional demand, a tightening float, and a dovish Fed have created a self-reinforcing cycle that could propel Bitcoin toward $135,000–$145,000 by year-end, according to WunderTrading.

Investors should monitor key triggers: the finalization of SEC/CFTC token regulations, further Fed rate cuts, and ETF inflow velocity. For now, the data tells a clear story-Bitcoin's bull case is intact, and the next chapter is being written.