Bitcoin's Price Drops 23% as Bull Score Hits Two-Year Low
1min read Bitcoin's recent price decline has sparked concerns among investors, as the cryptocurrency's value has dropped by 23% from its peak over the past few weeks. This downturn has been accompanied by a significant decrease in the Bitcoin Bull Score Index, which has hit a two-year low of 20. This index, developed by CryptoQuant, measures market conditions based on ten indicators covering network activity, investor profitability, Bitcoin demand, and liquidity. A score above 60 typically indicates a strong bullish environment, while readings below 40 often align with prolonged bear markets.
The current low score of 20 suggests a weakening investment environment, raising questions about whether the recent price correction is a temporary pullback or the start of a longer bear market. Historical data shows that Bitcoin has maintained rallies when the Bull Score stayed above 60, and extended low scores often come with bear markets. This has led some market participants to debate whether the current conditions signal the start of a bear market or if it reflects a temporary correction within a broader bull cycle.
CryptoQuant's report highlights several indicators that have turned bearish since mid-February 2025. The CryptoQuant Network Activity Index, for instance, has remained in negative territory since December 2024, reflecting a sustained decline in on-chain activity. Previous market cycles have shown that sustained bullish phases often require growing network activity and consistent demand for Bitcoin. The report also examines past periods when the Bull Score Index remained below 40 for extended stretches, which historically coincided with bear markets characterized by short-lived price recoveries and ongoing downward pressure.
While some investors expect Bitcoin to recover as it has in prior cycles, CryptoQuant's analysis recommends caution. If the Bull Score Index fails to rise above key thresholds, Bitcoin may continue facing downward pressure in the near term. The report suggests that a softer Bull Score implies that investor confidence is easing and fewer transactions are fueling price support, which could lead to a period where gains are harder to sustain, mirroring past correction phases. Reduced network activity can limit liquidity, meaning there are fewer buyers to push prices upward, which often results in more gradual recoveries or extended sideways movements in the market.
Historical trends can offer a framework to anticipate possible shifts in market dynamics. Past cycles have shown that when bullish metrics dip, it typically precedes prolonged corrections. This analysis underscores the importance of monitoring key indicators and understanding their implications for Bitcoin's price trends. As the market continues to evolve, investors will need to stay vigilant and adapt their strategies to navigate the changing landscape.
