Fidelity says Bitcoin’s recent rally does not necessarily mean the bear market is over.
In a new report, the asset manager said Bitcoin may be trading in line with patterns seen in earlier cycles, but the market could still find its bottom in November.
Fidelity says July may have marked the low, but another drop is still possible
According to Bitcoin Magazine, Chris Kuiper, vice president of research at Fidelity Digital Assets, wrote that Bitcoin’s latest performance leaves open two possibilities.
The low may already have been set in July. But Bitcoin could also fall again and make a new low in November or later. Kuiper added that Bitcoin cycles have historically not been precisely four years long, so they are not a dependable way to time the market.
August rally revived debate over whether the bear market has ended
Bitcoin started rising in mid-August after the U.S. Treasury Department said it would more than double the size of its government debt repurchases.
The asset was recently trading near $81,639, up nearly 30% over a 30-day period. That move led some market participants to argue that Bitcoin had already exited its bear market.
The report also noted that Bitcoin hit a record high of $126,080 in October last year. Even so, Fidelity’s view is that the latest rebound on its own is not enough to confirm that the bearish phase has fully passed.
Muted trading in June and July gave way to a sharper move in August
Kuiper said Bitcoin volatility was especially subdued through most of June and July, with the coin trading below $65,000 during that period.
That changed in August after the Treasury Department’s announcement. Since then, the so-called debasement trade has come back into focus, helping shape the current market narrative around Bitcoin.
Kuiper points investors to the Clarity Act
For clues on where Bitcoin goes next, Kuiper said investors should pay attention to the crypto bill known as the Clarity Act.
He wrote that supporters of the measure believe it could bring greater regulatory certainty and support continued innovation in the U.S. digital asset ecosystem.
The article said President Donald Trump urged lawmakers in August to push the long-awaited crypto market structure bill forward, a move that helped fuel Bitcoin’s run. After meeting crypto industry executives at the White House, Trump called the draft 「very, very powerful」.
The digital asset industry has long called for clear rules governing how regulators should treat Bitcoin, stablecoins, and other cryptocurrencies. Lawmakers are set to vote on the bill this month.
The article was first published by Bitcoin Magazine and written by Mathew Di Salvo.