Bitcoin Enters Short-Term Rebound Window Amid Miner Cost Support and Policy Shifts

Bitcoin on-chain metrics suggest a price bottom in late December 2025, with inflows strengthening since. Miner behavior historically creates a price floor when operations slow during unprofitable periods according to analysis. Trump's proposed 10% credit card interest rate cap could drive users toward decentralized finance, including Bitcoin and DeFi platforms as research shows.

Bitcoin's on-chain analyst Willy Woo has identified late December 2025 as a potential cyclical low, with inflows into exchange-traded funds and direct wallet acquisitions showing consistent growth. This trend is seen as a sign of accumulating investor confidence following a year of volatility. The price has traded below the estimated miner production cost of approximately $101,000, but this has not triggered panic selling. Instead, miners have adjusted production rates to wait for better prices.

The intersection of macroeconomic policy and on-chain fundamentals may support a short-term rebound in Bitcoin. President Donald Trump's recent proposal to cap credit card interest rates could inadvertently accelerate adoption of decentralized financial systems. This policy could restrict traditional credit access for consumers with lower credit scores, potentially pushing them toward DeFi platforms like Aave or Compound. Analysts highlight that this shift could increase demand for stablecoins, Bitcoin, and Ethereum-based infrastructure.

Despite the short-term optimism, broader macroeconomic concerns persist. Willy Woo notes that liquidity flows have declined relative to price momentum since January 2025, indicating a bearish trend in the broader 2026 outlook. While temporary rallies may occur, they lack the institutional support necessary for sustained upside. The coming weeks will be critical in determining whether Bitcoin can maintain a recovery driven by both on-chain fundamentals and policy shifts.

Why Does the Short-Term Rebound Matter to Investors?

The potential for a Bitcoin rebound is significant for investors due to its influence on market sentiment and liquidity. The strengthening inflows into Bitcoin ETFs and the stabilization of miner behavior have created a more favorable environment for price recovery. This is particularly relevant as institutional demand has returned to the crypto market, evidenced by large net inflows into U.S. spot Bitcoin ETFs at the start of 2026. The price's proximity to key levels like $98,000 and $100,000 could act as short-term psychological support.

What Are the Risks of a Bearish 2026 Outlook?

While the short-term outlook appears cautiously bullish, the broader macroeconomic landscape remains uncertain. Liquidity is weakening relative to price momentum, which increases the risk of a bearish 2026. On-chain metrics also show that large Bitcoin holders are reducing their holdings, indicating caution among major investors. Additionally, the price has been below its 50-week moving average for nine weeks, a bearish signal. A sustained outflow of capital would likely confirm a bear market, but such outflows are typically lagging indicators.

The convergence of miner cost support, policy shifts, and liquidity trends is creating a high-volatility environment for Bitcoin. Investors must remain cautious and monitor both short-term price movements and long-term macroeconomic indicators to assess the potential for further gains or corrections.