Blab Crypto
NYDIG Report: Bitcoin Still in Mid-Contraction, Key Signals of Reset Absent
NYDIG, the research firm known for its Bitcoin market‑cycle analyses, has released a fresh report that paints a clear picture: the cryptocurrency’s contraction phase is far from over. The study shows that Bitcoin’s decline from its all‑time high of $126,000 in October 2025 is about 52 %, and the market has yet to exhibit the capitulation signals that historically herald a reset.
Revisiting NYDIG’s Bitcoin Cycles Narratives Framework—first introduced in November of the prior year—the report highlights that, according to analyst Greg Cipolaro, the market is still “mid‑contraction with the reset still ahead.” In previous bear markets, Bitcoin’s peak‑to‑trough drawdowns ranged from 75 % to 85 %. Those cycles typically entered a reconstruction phase only after clear indicators of a finished contraction appeared. NYDIG notes that those markers are missing today: long‑term holders have not capitulated, no terminal insolvencies have emerged, and a reset has not yet taken place. Consequently, the market remains outside the Reconstruction and Reframing stages.
The study points to several early reversal cues that have already surfaced. Strategy Inc., the company with the largest corporate Bitcoin position, has made its first‑ever sale of the asset. Simultaneously, spot exchange‑traded fund (ETF) outflows have hit record highs, and the DAT mNAV inverted. NYDIG interprets these events as tentative signs that the contraction may be winding down.
Two pillars that fueled Bitcoin’s 2025 rally—spot ETF inflows and corporate treasury accumulation—have weakened in 2026. In October 2025, institutional buyers snapped up more than 48,000 BTC in a single week, pushing the price above $126,000. NYDIG cautions that, without a new wave of corporate treasury adoption or sustained ETF inflows, Bitcoin is unlikely to receive the same mechanical buying support that characterized much of 2025.
Corporate buying has become highly concentrated. Nearly all institutional demand now comes from Strategy, while several public mining companies have shifted to net selling positions. This narrowing of corporate participation limits the breadth of the market’s support base.
Seasonality also weighs on the current contraction. NYDIG’s seasonal analysis shows that August and September have historically been Bitcoin’s weakest months, with both average and median returns negative. For a market already in contraction, these seasonal headwinds add additional pressure.
In sum, NYDIG’s research indicates that Bitcoin remains in the middle of a contraction cycle, with the reset still pending. The absence of long‑term holder capitulation, terminal insolvencies, and a reset signal suggests that the market has not yet entered the reconstruction phase. While early reversal markers such as Strategy’s first sale and record ETF outflows are present, the weakening of spot ETF inflows and corporate treasury accumulation in 2026—combined with a concentration of corporate buying and negative seasonal trends—implies that Bitcoin may not experience the same level of mechanical buying support seen in 2025.
The report offers a detailed framework for tracking Bitcoin’s market phases and provides analysts with a tool to assess when the contraction may conclude. As the market continues to evolve, NYDIG’s findings will be closely monitored by investors and analysts seeking to understand Bitcoin’s next potential turning point.
Revisiting NYDIG’s Bitcoin Cycles Narratives Framework—first introduced in November of the prior year—the report highlights that, according to analyst Greg Cipolaro, the market is still “mid‑contraction with the reset still ahead.” In previous bear markets, Bitcoin’s peak‑to‑trough drawdowns ranged from 75 % to 85 %. Those cycles typically entered a reconstruction phase only after clear indicators of a finished contraction appeared. NYDIG notes that those markers are missing today: long‑term holders have not capitulated, no terminal insolvencies have emerged, and a reset has not yet taken place. Consequently, the market remains outside the Reconstruction and Reframing stages.
The study points to several early reversal cues that have already surfaced. Strategy Inc., the company with the largest corporate Bitcoin position, has made its first‑ever sale of the asset. Simultaneously, spot exchange‑traded fund (ETF) outflows have hit record highs, and the DAT mNAV inverted. NYDIG interprets these events as tentative signs that the contraction may be winding down.
Two pillars that fueled Bitcoin’s 2025 rally—spot ETF inflows and corporate treasury accumulation—have weakened in 2026. In October 2025, institutional buyers snapped up more than 48,000 BTC in a single week, pushing the price above $126,000. NYDIG cautions that, without a new wave of corporate treasury adoption or sustained ETF inflows, Bitcoin is unlikely to receive the same mechanical buying support that characterized much of 2025.
Corporate buying has become highly concentrated. Nearly all institutional demand now comes from Strategy, while several public mining companies have shifted to net selling positions. This narrowing of corporate participation limits the breadth of the market’s support base.
Seasonality also weighs on the current contraction. NYDIG’s seasonal analysis shows that August and September have historically been Bitcoin’s weakest months, with both average and median returns negative. For a market already in contraction, these seasonal headwinds add additional pressure.
In sum, NYDIG’s research indicates that Bitcoin remains in the middle of a contraction cycle, with the reset still pending. The absence of long‑term holder capitulation, terminal insolvencies, and a reset signal suggests that the market has not yet entered the reconstruction phase. While early reversal markers such as Strategy’s first sale and record ETF outflows are present, the weakening of spot ETF inflows and corporate treasury accumulation in 2026—combined with a concentration of corporate buying and negative seasonal trends—implies that Bitcoin may not experience the same level of mechanical buying support seen in 2025.
The report offers a detailed framework for tracking Bitcoin’s market phases and provides analysts with a tool to assess when the contraction may conclude. As the market continues to evolve, NYDIG’s findings will be closely monitored by investors and analysts seeking to understand Bitcoin’s next potential turning point.
