Deteriorating Bitcoin Market Sentiment

Bitcoin market sentiment has declined to levels not observed since January 2023, as reported by crypto analytics firm CryptoQuant.

In a report released on Thursday, CryptoQuant stated that its Bull Score Index has dropped to 20, indicating that only two out of ten key metrics are in bullish territory. This level marks the lowest reading in over two years and is well below the threshold historically required to support sustained price appreciation.

The report indicates that this decline returns the market to a previous low, leading to a “weak environment” for Bitcoin, which diminishes the likelihood of a sustained rally in the short term. CryptoQuant suggests that this trend could be indicative of a larger bearish trend rather than a mere short-term correction.

The Bull Score Index synthesizes ten distinct metrics that assess network activity, investor behavior, Bitcoin demand, and market liquidity to gauge overall market health. Historically, a score above 60 has been necessary to maintain significant price rallies, while prolonged scores below 40 have typically signaled bear markets.

CryptoQuant’s dashboard indicates a marked decline in on-chain fundamentals since mid-February 2025, with eight metrics currently flashing warning signals. The Network Activity Index, which tracks on-chain usage, has remained bearish since December 2024.

Analysts note that should the score remain below 40 for an extended period, it could signify ongoing bearish market conditions, countering the idea that Bitcoin’s recent drawdown of up to 23% from its peak at $109,000 in January reflects merely a temporary correction.

Further context also contributes to this precarious situation. Bitcoin’s volatility has surged to a six-month high, even as some analysts speculate that new all-time highs could be reached by mid-year, driven by easing global liquidity conditions.

On Wednesday, the Federal Reserve announced it would maintain steady interest rates, leading to immediate but modest gains in major crypto markets, including Bitcoin, Ethereum, and Solana.

As of the time of writing, Bitcoin has declined by 1.8%, trading at $84,400. On MYRIAD, an on-chain prediction market developed by Decrypt’s parent company DASTAN, 68% of participants believe that Bitcoin will remain above $83,000 before next week.

Edited by Sebastian Sinclair