The fact that Bitcoin fell below 60 thousand dollars and hit the lowest level of this cycle increased the discussions about the reasons for the selling pressure in the market. According to Greg Cipolaro, Head of Global Research at NYDIG, it is difficult to explain the decline with a single development. In his report published last week, Cipolaro stated that both Bitcoin and the broader crypto market face several overlapping negative elements.
Artificial intelligence and public offering expectations came to the fore
Artificial intelligence-themed investments ranked first in the report. According to Cipolaro, Bitcoin provides a more significant competition for capital against the artificial intelligence sector, which has become the dominant growth story of the recent period. Arguing that the crypto and artificial intelligence investor base overlaps more than expected, Cipolaro stated that both fields attract investors who are oriented towards new technologies and seeking high returns. It was reported that as artificial intelligence-related stocks performed strongly, some of the capital shifted from crypto to this area.
In addition, it was evaluated that investors may be preparing for the biggest technology IPO wave of recent years. The report stated that companies such as SpaceX, OpenAI and Anthropic are expected to be listed on the stock market in the future, and that SpaceX is at a more advanced point in this process. It was noted that institutional investors reducing their current positions to generate cash before large-scale public offerings could put additional pressure on the demand for crypto assets.
Mini dictionary: An initial public offering is the first time a company offers its shares to investors on the stock exchange. The abbreviation IPO also refers to this process, and the public offering of large technology companies can affect the distribution of liquidity in the markets.
Sector-specific risks remained on the agenda
The factors affecting prices in the crypto market are not limited to these. US Treasury Secretary Scott Bessent’s statement that approximately $1 billion worth of Iran-related crypto assets were seized by US authorities raised questions about the ability of public authorities to access digital asset markets. While details of the incident remain limited, Cipolaro said it may have called into question one of crypto’s core narratives for some investors.
Another topic was quantum computing. It was stated that the new study published by the researchers indicates that the computing power required for possible attacks against widely used cryptographic systems may decrease faster than previously estimated. The re-emergence of this topic has revived long-term security discussions.
Cipolaro also pointed out Strategy’s sale of 32 BTC. It was emphasized that the value of the sale that day was 2.5 million dollars and that it had a limited impact on the supply side, but was more important from a psychological perspective. It was stated that the possibility that Strategy, which has long been seen as one of the most regular buyers in the market, could turn into a potential source of supply could weaken one of the important pillars of the bullish expectation.
When considered alone, each of these developments does not seem sufficient to explain a major correction in Bitcoin. But taken together, they help explain why price action has weakened despite no clear deterioration in key adoption indicators.
Does Onchain data signal a bottom?
Cipolaro’s conclusion from on-chain data pointed to a more complex picture. According to the report, some indicators are approaching points that coincide with historically significant lows. Bitcoin’s MVRV ratio decreased to 1.2. This level is considered close to the periods when the market value approaches the total cost of investors. The proportion of supply held in profit has also recently fallen below 50 percent. This indicator has also been associated with periods of surrender in the past.
However, it was stated that the current retreat is still limited by historical standards. Bitcoin has fallen nearly 53 percent from its peak of $126,000 in October. Cipolaro noted that this was a shallower decline compared to declines of 75 percent to 90 percent seen in previous cycles.
The time factor was also one of the important elements in the report. It is a reminder that the previous three Bitcoin bear markets took roughly a year from peak to trough, with only the first bear market in 2011 ending in 163 days. The last drop, below $60,000 on Friday, occurred only 242 days after the peak.
In this context, Cipolaro stated that institutional adoption may have permanently changed the structure of Bitcoin cycles, or the market may not have reached a true capitulation phase yet. According to him, on-chain data points to a meaningful reset in the market. But whether a bottom is seen will depend on whether institutional demand structurally alters the cycle or simply delays a deeper correction.
