Is Bitcoin Entering a Prolonged Bear Phase? Interpreting On-Chain and Corporate Treasury Signals

Bitcoin's price action in late 2025 has painted a mixed picture: a fragile trading range, elevated supply pressures, and institutional demand surging amid regulatory clarity. To determine whether Bitcoin is entering a prolonged bear phase, we must dissect structural shifts in demand and liquidity through on-chain metrics and corporate treasury movements. The data reveals a market caught between bearish headwinds and resilient institutional conviction.

On-Chain Metrics: A Fragile Equilibrium

Bitcoin has been range-bound between $81,000 and $91,000 since peaking at $126,000 in 2025, constrained by a dense supply wall between $93,000 and $120,000. This overhead resistance, combined with a confluence of cost-basis metrics-mean cost of active supply, ETF-weighted cost basis, and the 2024 cohort cost basis-has created a strong support cluster near $80,000 according to MEXC analysis. While this suggests structural demand from diverse investor groups, the market remains vulnerable.

Elevated supply in loss has risen to 6.7 million BTC, with 23.7% of the circulating supply held at a loss. Of this, 10.2% is controlled by long-term holders and 13.5% by short-term holders, signaling prolonged stress that could trigger capitulation. If prices fall further below the True Market Mean of $81,300, the "loss seller" cohort could expand, exacerbating downward pressure.

Futures and options markets reinforce a range-bound narrative. Open interest has trended lower, funding rates are near neutral, and large December options expiries are pinning price action into year-end according to Cryptoslate analysis. This lack of directional bias suggests traders are hedging for consolidation rather than a breakout.

Corporate Treasury Accumulation: Scarcity vs. Stress

Corporate treasuries have emerged as a structural demand driver, with public companies holding over 1.05 million BTC by late 2025-approximately 5% of the total supply according to Xmultiverse analysis. This accumulation has outpaced mining issuance in multiple quarters, tightening liquidity and creating artificial scarcity according to the same analysis. Institutions now view Bitcoin as a strategic asset, with 86% of institutional investors holding or planning to hold digital assets.

However, this demand comes with risks. In November 2025, 65% of companies in a sample of 100 that purchased Bitcoin above current prices faced unrealized losses. Despite this, high-conviction players like Strategy and American Bitcoin Corp. continued to dominate net additions, accounting for 75% of purchases after sales. This concentration of buying activity underscores the influence of institutional actors with long-term conviction, even amid short-term pain.

Corporate demand is driven by Bitcoin's non-correlation with traditional assets, its fixed supply, and its role as a hedge against inflation. Innovations like Bitcoin-backed loans and collateralized financing further cement its utility in institutional portfolios according to Barchart analysis. Regulatory frameworks, including the U.S. GENIUS Act and the EU's MiCA, have also reduced friction for adoption according to SSGA analysis.

Institutional Demand: A Floor or a Fad?

The approval of U.S. spot ETFs and global regulatory clarity have catalyzed institutional adoption, with crypto ETF AUM surpassing $191 billion. This represents a shift from speculative trading to strategic allocation. Yet, the market remains dependent on sustained corporate and institutional buying to offset elevated supply pressures.

While spot activity remains episodic, futures markets have de-risked, and options activity reflects range-bound expectations according to Glassnode analysis. This suggests that institutional demand, while growing, has not yet created a self-sustaining upward trend.

Conclusion: Structural Demand vs. Bearish Fundamentals

Bitcoin's on-chain environment is fraught with supply-side challenges, but structural demand from corporate treasuries and institutions is reshaping liquidity dynamics. The $80,000 support level and continued accumulation by high-conviction players suggest a floor rather than a prolonged bear phase. However, the risk of capitulation from loss-holding short-term holders remains acute.

The coming months will hinge on two key factors:
1. Price stability above $81,300 to avoid expanding the loss seller cohort.
2. Sustained corporate and institutional buying to offset overhead supply.

If these conditions hold, Bitcoin may consolidate into a new equilibrium rather than enter a deep bear market. But if structural demand falters, the fragile balance could tip downward. For now, the market is in a holding pattern-waiting for clarity on whether institutional conviction can outlast bearish fundamentals.