Matrixport Research: The trading environment continues, but a new round of upward cycle still needs to wait

Entering 2026, the market phase for Bitcoin is different from the early rebound of previous cycles. Although there have been signs of technical recovery recently and a tactical shift towards a moderately positive stance, the structural signals indicate that the conditions supporting a sustained bull market are still insufficient. Historical experience shows that once the price falls below the one-year moving average, it often enters a more challenging operating 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 Whales Continue to Reduce Holdings: Orderly Chip Distribution but Pointing to High Range

On-chain data indicates that long-term holders are still continuously and orderly distributing their chips. After the Bitcoin spot ETF launches in early 2024, "super whales" increased their buying intensity during the initial pullback phase, but since October 2024, their behavior has clearly shifted from "accumulating" to "reducing." According to cumulative statistics, this group has sold approximately $61 billion worth of Bitcoin since then and has maintained a net selling position in the last 30 days.

This selling pressure has mostly been absorbed by medium-sized whale groups, resulting in price movements more characterized by repeated tug-of-war within a high range, rather than typical accelerated peaks or panic sell-offs. Unlike the indiscriminate selling seen after the peak in spring 2021, this round of selling is more orderly and aligns better with the behavior characteristics of mature capital in the later stages of the cycle, indicating that Bitcoin is at least in a cyclical top range.

Weak Incremental Funds: Price Close to TMMP, Upside Momentum Limited

From a funding perspective, the core constraint of this cycle remains the lack of incremental funds. The net increase in Bitcoin's realized market cap has continued to decline since peaking at the end of 2024. Although the price rebounded multiple times in 2025, the funding situation has weakened ahead of the price. This divergence explains why the previous rise was difficult to sustain and indicates that the current rebound is still built on a weak funding foundation.

At the same time, the slowdown in new address growth shows that the market has yet to attract a significant number of new investors, and widespread retail participation has not yet formed. Bitcoin's price is currently close to the True Market Mean Price (TMMP), indicating that the willingness of incremental buyers to chase prices is not strong. Historically, sustained price increases often require prices to be significantly distanced from TMMP, accompanied by confirmed capital inflows; if the funding does not keep up, prices are more likely to oscillate around TMMP rather than continue to rise and open up upward space.

Overall, although the technical recovery allows for a relatively positive tactical stance, this round of upward movement should be viewed as a tactical rebound rather than the starting point of a new structural upward cycle. Bitcoin still faces core constraints such as insufficient incremental capital inflows and continued selling by super whales, making upward space likely limited. In such an environment, the market is more likely to focus on phase-based, trading-oriented opportunities rather than smooth trend extensions. Compared to previous cycles, there are fewer new participants this time, and whether the market can achieve a sustained rebound hinges not on "how many people" are involved, but on "how much new capital" is present. Against the backdrop of insufficient funding strength, risk management and discipline should still take precedence over a long-term holding strategy focused solely on one-sided bullish positions.

The above views are partly derived from Matrix on Target. Contact us for the complete report from Matrix on Target.

Disclaimer: The market is risky, and investment should be cautious. This article does not constitute investment advice. Trading in digital assets may 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 made based on the information provided herein.