According to a report by Cointelegraph, despite Bitcoin's recent 30% decline from its all-time high of $109,350 to a four-month low of $76,700 on March 11, four key indicators suggest that the current adjustment may have already ended.
First, the current adjustment is fundamentally different from the bear market in November 2021. In the 2021 bear market, Bitcoin plummeted 41% from $69,000 to $40,560 within 60 days, while the current adjustment is more similar to the 31.5% correction in June 2024. A true bear market requires at least a 40% decline, which has not yet been reached.
Second, the US dollar index (DXY) has declined from 109.2 at the beginning of 2025 to 104, in contrast to the strong US dollar during the bear market at the end of 2021. Analysts point out that Bitcoin typically has an inverse correlation with the US dollar index, and the current weakening of the US dollar is favorable for Bitcoin's price stabilization.
Third, the derivatives market data shows healthy signs. Although the price declined 19% from March 2 to 11, the annualized premium on Bitcoin futures remained at 4.5%, much higher than the negative premium level during the bear market in June 2022. Meanwhile, the perpetual contract funding rate is close to zero, indicating a balanced demand for leverage between longs and shorts, without the typical excessive demand seen in a bear market.
Fourth, market concerns are mainly focused on the potential US government shutdown on March 15 and the risk of a bubble in the artificial intelligence sector. Several companies with a market capitalization of over $150 billion have seen significant declines from their highs, including Tesla (-54%), Nvidia (-34%), and TSMC (-26%). This risk sentiment has led to the short-term adjustment in Bitcoin.
Additionally, early signs of a crisis in the US real estate market may accelerate the flow of capital into scarce assets. Analysts believe that the weakening US dollar, historical data indicating that a 30% price adjustment is insufficient to determine a bear market, the resilience of the Bitcoin derivatives market, market volatility due to the risk of a government shutdown, and the signs of a real estate market crisis will all support Bitcoin's return to the $90,000 level.
Currently, Bitcoin has rebounded from its low, and market participants are closely monitoring the progress of the US government debt ceiling negotiations, as there are divisions within the Republican party on defense and immigration spending issues. If an agreement is reached, the risk asset market, including Bitcoin, may see a positive reaction.
