Is the 2018 Bear Market Returning? CryptoQuant Flags Critical Bitcoin Activity Slump

Bitcoin On-Chain Activity Slows Sharply: CryptoQuant Flags Bearish Signals in Late 2025

As of December 22, 2025, Bitcoin (BTC) trades around $89,000, consolidating in a narrow range amid persistent market uncertainty. CryptoQuant's latest analysis highlights a noticeable slowdown in network activity, reinforcing concerns about a weakening market structure and reduced speculative interest.

Key On-Chain Metrics Point to Declining Engagement

CryptoQuant reports that Bitcoin's 30-day moving average now sits 0.52% below its 365-day moving average, a technical signal that underscores the ongoing downtrend. This crossover echoes patterns seen in previous bearish phases, where sustained weakness in short-term averages often preceded prolonged corrections.

Daily transaction volume has dipped from approximately 460,000 to 438,000, while total daily transaction fees have edged lower from $233,000 to $230,000. The number of high-activity addresses—those with significant on-chain interactions—has fallen from 43,300 to 41,500, reflecting waning participation from both retail and active investors.

These declines indicate a broader retreat from speculative behavior. Traders and institutions appear to be adopting a more defensive posture, with reduced urgency to transact or accumulate aggressively.

Comparison to Historical Bear Markets

The current setup draws parallels to the 2018 bear market, when network activity contracted sharply amid prolonged price weakness. However, today's ecosystem shows greater resilience: active users hover around 800,000, compared to roughly 600,000 during the 2018 lows. This larger user base suggests stronger structural support, even as short-term metrics deteriorate.

Historically, sharp drops in on-chain activity have often served as early warnings of elevated volatility. Similar slowdowns preceded major swings in past cycles, where reduced engagement cleared out excess speculation before new momentum emerged.

Broader Market Context and Investor Behavior

The slowdown aligns with cooling institutional demand. U.S. spot Bitcoin ETFs have shifted to net outflows in recent weeks, while derivatives markets show lower funding rates and reduced leveraged positions. On-chain indicators, including declining transaction counts and active addresses, reinforce the view that speculative inflows have tapered off after earlier 2025 highs.

Despite these pressures, Bitcoin's fundamentals remain intact. The network's hash rate stays robust, and long-term holders continue to accumulate during dips. This defensive stance by major players could limit downside depth compared to previous cycles.

What Investors Should Watch Next

CryptoQuant analysts stress the importance of monitoring both on-chain data and macroeconomic developments in the coming weeks. Key levels to watch include:

• A sustained break above recent resistance near $92,000–$94,000, which could signal renewed buying pressure.
• Further declines below $85,000, potentially accelerating volatility if support fails.

A meaningful increase in transaction volume, active addresses, or ETF inflows would indicate a shift toward bullish momentum. Without such catalysts, Bitcoin may remain range-bound or face additional downside pressure in the short term.

Outlook: Consolidation Likely Before Next Move

Bitcoin's current phase reflects a healthy reset after an extended rally earlier in 2025. While on-chain slowdowns raise caution, the larger user base and institutional footprint provide a buffer against severe declines. Investors should remain vigilant, focusing on volume recovery and external factors like regulatory clarity or global risk sentiment.

In the near term, directionless trading appears most probable. However, history shows that periods of reduced activity often precede significant moves—higher or lower—once conviction returns to the market. Patience and close monitoring of these metrics will be essential for navigating the weeks ahead.

Robert Petrov publication: "Is the 2018 Bear Market Returning? CryptoQuant Flags Critical Bitcoin Activity Slump" was written for 24crypto.news

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