Bitcoin's Valuation Reset: A Strategic Entry Point Amid Structural Bearishness

Bitcoin's market structure in Q3 2025 has deteriorated into a structurally bearish regime, marked by a confluence of on-chain and technical indicators. The Structure Shift composite signal, a critical gauge of market sentiment, has plunged to -0.5, a level historically associated with sustained downside pressure rather than short-lived corrections. Simultaneously, the Bull-Bear market structure index reveals a stark imbalance: the bullish component has collapsed to just 5%, while the fast bearish component deepens into negative territory as indicators flip negative. These metrics, combined with Bitcoin's inability to reclaim key resistance levels like $90,000 and its entrapment within a fragile $81K–$89K range, underscore a market grappling with weak liquidity.

Yet, amid this bearish backdrop, on-chain data reveals a nuanced narrative of accumulation. The Miner Position Index (MPI) at -0.81 indicates miners are reducing their exchange activity, signaling diminished selling pressure. Meanwhile, wallets holding 1,000–10,000 BTC have accumulated nearly 700,000 BTC over two months, suggesting institutional confidence in Bitcoin's long-term value. This accumulation is further reinforced by the MVRV Z-Score, which, after dropping to 1.43 following a $100K-to-$75K correction, has shown signs of recovery. While this level historically aligns with local bottoms rather than bear market tops, it hints at a potential reset within a broader bull cycle as indicators suggest recovery.

Historical parallels offer additional context. During past bear markets (2018–2020, 2022), Bitcoin's accumulation phases were characterized by rising accumulation addresses and on-chain metrics like MVRV and SOPR. For instance, when MVRV dips below 1.0, the market trades below its aggregate cost basis, a signal of bear market bottoms. Currently, MVRV sits at 1.8–2.0, indicating a cooling market but not yet a deep value zone. However, the surge in accumulation addresses post-October 2025 mirrors patterns from 2018–2019 and 2022, where long-term holders viewed price weakness as a buying opportunity. This behavior aligns with the broader trend of reduced exchange balances, as investors shift coins to private wallets, tightening supply and potentially catalyzing future appreciation.

The current environment also reflects a maturing market structure. Institutional adoption, evidenced by steady ETF inflows, is reshaping Bitcoin's traditional 4-year cycle. Unlike previous cycles, the absence of a bear market following the 2024 halving and the controlled nature of recent bull runs suggest a shift toward institutional-driven demand. This evolution complicates traditional bearish signals, as the market exhibits characteristics of both a deep correction and a bull cycle reset.

For investors, the interplay of structural bearishness and accumulation dynamics presents a strategic entry point. While macroeconomic risks-such as a potential global recession-remain, the on-chain evidence of long-term holder absorption and the historical precedent of accumulation phases preceding bull cycles justify a cautious bullish stance. The Short-Term Holder Realized Price at $113,000 acts as a critical support level, and Bitcoin's ability to hold above this threshold could signal renewed investor confidence.

In conclusion, Bitcoin's valuation reset in Q3 2025 is not a definitive bear market confirmation but a complex inflection point. The combination of deteriorating market structure, persistent accumulation, and historical parallels suggests that the current phase is a setup for a potential bull cycle resurgence. Investors attuned to these signals may find value in positioning for a long-term rebound, provided they remain mindful of macroeconomic headwinds.