Rumors of a new “crypto winter” are back—and this time the warning comes with a specific number. Analysts from on-chain research firm CryptoQuant told ForkLog that demand growth for Bitcoin has slowed enough to suggest the cycle is rolling over, with a potential bottom near $56,000—roughly where Bitcoin’s realized price currently sits. They also highlighted $70,000 as an interim support area. If the $56K scenario plays out, it would mark about a 55% drawdown from the all-time high, a milder decline than prior bear markets.
Why $56,000? The realized price lens
The headline figure isn’t arbitrary. CryptoQuant points to realized price—the average cost basis of all coins based on their last on-chain move—as a historically important magnet during bear-market lows. In past cycles, spot price eventually converged toward this level before a new accumulation phase began. Current research pages and media summaries of CryptoQuant’s latest note frame $56,000 as that anchor, with $70,000 as a likely waystation if selling continues.
CryptoQuant also argues the market structure has weakened: spot demand from large buyers has softened, on-chain activity has cooled, and Bitcoin slipped below its 365-day moving average, a long-term gauge that often flips with cycle turns. In their words, demand has “exhausted” relative to earlier in the year, raising the odds of a prolonged cool-down.
Market context: from peak to pullback
The warning lands after a volatile year. Bitcoin set a record above $126,000 in early October 2025 before a sharp risk-off episode triggered massive liquidations and a market reset. Since then, prices have chopped lower, with BTC hovering around the high-$80,000s in recent days—about 30% below the peak. That backdrop makes a methodical test of deeper support plausible—even without a dramatic catalyst.
How this view fits with other 2026 outlooks
CryptoQuant’s caution echoes a separate, widely covered call from Fidelity’s global macro strategist Jurrien Timmer, who said 2026 could be an “off year” for Bitcoin within the four-year cycle framework, identifying $65,000–$75,000as a key support zone. While Timmer didn’t single out $56,000, both frameworks emphasize that the next 6–12 months could look like consolidation or a bear phase rather than a fresh melt-up.
That said, the analyst community isn’t unanimous. Some Wall Street notes still lean constructive for 2026, citing ETF demand and institutional adoption—but the near-term tape has favored the defensive take as liquidity narrows and risk budgets tighten.
What would confirm the “crypto winter” thesis?
1) Persistent demand weakness. CryptoQuant’s thesis is demand-driven: fewer large net buyers, softer ETF flows, and muted on-chain activity. If these trends continue, the probability of revisiting deeper supports rises.
2) Price living below long-term averages. A sustained stretch under the 365-day moving average has aligned with bear phases historically. The longer BTC closes below that mark, the more traders will treat rallies as bounces inside a downtrend.
3) Interaction with $70K → $56K. Many eyes will be on $70,000 first. If that gives way on volume and derivatives positioning remains fragile, technicians will look for whether dip-buyers defend the realized price zone around $56,000.
Why a “mild” bear market is still on the table
A 55% peak-to-trough drawdown would be milder than the ~77% contraction into the 2022 low, which is why some see the $56K zone as a “shallow winter” rather than a deep freeze. The difference this cycle: broader institutional participation, more robust market infrastructure, and (despite recent cooling) the presence of regulated ETF vehiclesthat tend to smooth flows over time. Still, as 2025 showed, leverage and macro shocks can overwhelm structural progress in the short run.
What could invalidate the bearish case?
- Resurgent spot demand from ETFs and large wallets, visible in on-chain accumulation and custody data, would challenge the idea that demand has rolled over.
- Back above the 365-DMA with improving breadth (more coins and sectors participating) would hint the “winter” may be a shakeout rather than a full phase change.
- Macro tailwinds—like easier financial conditions or a risk-on shift—could re-ignite appetite for higher-beta crypto exposure.
Until then, the market remains range-bound and headline-sensitive. Recent price logs show BTC struggling to hold advances near $89K–$90K, consistent with a cooling trend rather than a decisive reversal.
How traders are likely to use the levels
Even if you don’t subscribe to the four-year cycle narrative, levels can be useful risk markers:
- $70,000: First major support cited by CryptoQuant; a failure there would strengthen the case for a larger retracement.
- $56,000: The realized-price magnet; a test here would line up with prior cycle bottoms where long-term buyers gradually took the other side.
As always, realized price isn’t a guarantee—it’s a reference derived from on-chain cost basis that has, historically, coincided with value zones when fear peaks.
Conclusion
ForkLog’s report captures a growing consensus inside on-chain analytics that Bitcoin’s demand cycle has cooled enough to justify the phrase “crypto winter”—with $70,000 and $56,000 the levels to watch. That view is broadly consistent with Fidelity’s macro framing of $65K–$75K support in 2026, even if opinions differ on duration and depth. For now, the data say the path of least resistance is sideways-to-lower unless demand re-accelerates. Whether this winter proves shallow or severe will come down to flows, macro, and whether buyers show up when the market finally tests its realized price.