Bitcoin BCMI Dives to 0.2, Mirroring Bear Phases of 2018 and 2022

CryptoQuant's Combined Market Index (BCMI) has declined to a low of 0.2, signaling that Bitcoin (BTC) may be in a bearish phase similar to those seen in 2018 and 2022.

The BCMI aggregates various valuation metrics, including MVRV, profitability indicators like NUPL, spending behavior via SOPR, and broader sentiment measures into a single composite reading. In October, the index was near the equilibrium level of 0.5, but has since fallen without producing the typical expansion reset seen during healthy corrections.

The current readings remain above the capitulation levels of 0.10-0.15 observed in past cycle bottoms, suggesting that full capitulation has not yet arrived. However, the decline into the low 0.2 range reflects a convergence of negative signals, including shrinking unrealized profits, rising realized losses, deteriorating sentiment, and ongoing valuation compression.

Unless the index stabilizes and reclaims the 0.4-0.5 zone, CryptoQuant's analysis indicates the probability of continued structural weakness remains elevated. Recent price declines have been accompanied by elevated trading volume, which analysts typically associate with distribution or forced deleveraging rather than gradual profit-taking.

Bitcoin's near-term direction remains closely tied to liquidity conditions, institutional flows, and broader macroeconomic sentiment affecting risk assets.