Matrixport Research: Trading environment continues, but a new upward cycle still needs to wait

Entering 2026, the market phase Bitcoin is in is different from the early rebound of previous cycles. Although there are recent signs of technical recovery, tactically it can be moderately shifted to a more positive stance, but from a structural signal perspective, the conditions to support a sustained bull market are still insufficient. Historical experience shows that once the price falls below the 1-year moving average, it often enters a more challenging trading range. Coupled with weakening incremental funds and slowing capital inflows, this cycle is more likely to enter a market environment that requires selective opportunities and emphasizes trading discipline.

Super whale selling continues: orderly chip distribution but pointing to high-level ranges

On-chain data indicates that long-term holders are still continuously and orderly distributing chips. After the launch of Bitcoin spot ETFs in early 2024, “super whales” initially increased buying during the early decline phase, but since October 2024, their behavior has clearly shifted from “accumulating” to “selling.” According to cumulative data, this group has sold approximately $61 billion worth of Bitcoin since then, and has maintained a net selling stance in the past 30 days.

This selling pressure has been largely absorbed by medium-sized whale groups, causing the price to fluctuate within high-level ranges rather than experiencing typical acceleration to the top or panic-driven liquidations. Unlike the indiscriminate selling after the peak in spring 2021, this round of selling is more orderly and aligns with the behavior characteristics of mature funds in the later stages of the cycle, indicating that Bitcoin is at least in a cyclical top range.

Incremental funds remain weak: price near TMMP, upward momentum limited

From a capital perspective, the core constraint of this cycle remains insufficient incremental funds. Bitcoin’s realized cap 30-day net increase has been declining since peaking at the end of 2024. Despite multiple rebounds in 2025, the capital side has already weakened beforehand. This divergence explains why previous rallies struggled to continue and also suggests that the current rebound is still based on weak funding foundations.

Meanwhile, new address growth has slowed, indicating that the market has yet to attract large-scale new investors, and broad retail participation has not yet formed. Bitcoin’s current price is close to the True Market Price (TMMP), meaning the willingness of incremental buyers to chase prices is not strong. Historically, sustained upward movements often require prices to be significantly away from TMMP, accompanied by confirmed capital inflows; if capital does not follow, prices tend to revert to oscillate around TMMP rather than continue upward, opening more space for further gains.

Overall, although technical recovery allows for a more positive tactical stance, this upward move should be viewed more as a tactical rebound rather than the start of a new structural upward cycle. Bitcoin still faces core constraints such as insufficient incremental capital inflows and continued whale selling, with limited upside potential. In such an environment, the market is more likely to present phase-based, trading-oriented opportunities rather than a smooth trend extension. Compared to previous cycles, the number of new participants is relatively small; whether the market can sustain a continued rebound depends less on “how many people” and more on “how much new capital.” In a context of weak capital strength, risk management and discipline should take priority over long-term bullish positions.

Some of the above views are from Matrix on Target. Contact us to obtain the full Matrix on Target report.

Disclaimer: The market carries risks; investment should be cautious. This article does not constitute investment advice. Trading digital assets can involve significant risks and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions based on the information provided herein.