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Skeptics who claimed that the influx of institutional money had destroyed Bitcoin's traditional four-year cycles have once again been proven wrong. The Bitcoin Cycle Momentum on-chain indicator from analytics platform CryptoQuant has entered positive bullish territory for the first time in eight months.
Historically, this signal has accurately marked the end of prolonged downturns, confirming that crypto market cycles still work like clockwork.
For the reversal to be considered fully confirmed, the indicator must consolidate at higher levels in the coming weeks. The foundation is already there: Bitcoin's recent rapid surge from $62,000 to $81,000 pulled the market out of a months-long slumber and triggered a wave of activity.
The current recovery is following the classic cycle-transition scenario: coins are flowing en masse from panicking retail investors to long-term holders. While retail players were realizing losses amid widespread fear, large investors were aggressively buying the bottom.
The statistics for August clearly confirm this:
- Large wallets holding at least 100 BTC: added around 60,000 BTC to their holdings.
- Small investors holding less than 100 BTC: sold a combined total of around 47,000 BTC.
Large holders are so confident in an imminent rally that, instead of selling their Bitcoin, they have begun using it as collateral for loans to ride out the downturn. On specialized platforms, the volume of such loans among large investors increased by 18% as they temporarily shifted part of their risk exposure into other digital assets.
Billions have flowed into crypto, but the rally is delayed. Are retail investors to blame?
The technical reversal is backed by a real influx of capital. Global liquidity is returning to the market: U.S. spot Bitcoin ETFs recorded their strongest weekly investor inflows in the past 10 months, while more than $470 million in USDC stablecoins — digital equivalents of the dollar — flowed into major exchanges.
Nevertheless, it is too early to expect uninterrupted growth from current levels. At around $78,000, Bitcoin entered what is known as "strategic limbo" — a neutral zone where the price is considered fair at the moment and the market needs a breather. Temporary overhead pressure is coming from retail investors, who began selling coins en masse to secure quick profits immediately after the first wave of growth.
The key support zone is now around $69,000 — the average price at which short-term investors bought their Bitcoin. If the market holds this level, a return to the broader bullish trend will be only a matter of time.
Dan Burgin
U.Today Editorial Team
