Bitcoin Targets $125K as Galaxy Declares Bear Market Over
Galaxy Research identifies reduced selling pressure and fiscal tailwinds supporting a new bullish cycle.
1Bear Market Officially Concluded
Galaxy Research asserts that the bitcoin bear market reached its definitive bottom in June 2026. This conclusion follows an analysis of historical recovery patterns and current market dynamics. The firm suggests that the current accumulation phase mirrors trends that preceded every significant price advance in the asset's previous market cycles.
2Technical Recovery Milestones Achieved
Bitcoin successfully reclaimed its 50-week moving average in September, a critical technical milestone for long-term recovery. After spending 44 weeks below this threshold, the asset recorded five consecutive weekly closes above it. Historical data indicates that similar recoveries typically lead to new all-time highs within a period of 33 to 83 weeks.
3Institutional Demand and ETF Flows
Spot bitcoin ETFs have played a pivotal role by absorbing supply, adding 87,000 BTC since the June lows. While some trading firms reduced exposure by 68,000 BTC, other institutional entities collectively added 20,000 BTC between September 2025 and June 2026. This shift reflects a transition toward more resilient, long-term institutional holding patterns.
4Onchain Indicators Show Resilience
Current onchain metrics reveal a shallower 53% maximum drawdown compared to previous bear market cycles. Bitcoin remains consistently above its aggregate onchain cost basis, while short-term holders sit roughly 9% above their average acquisition cost. Notably, there has been no substantial profit-taking, indicating a lack of aggressive selling pressure from investors.
5Fiscal Pressures Drive Bullish Case
Galaxy highlights the $40.44 trillion U.S. federal debt and a $1.99 trillion annual deficit as catalysts for bitcoin adoption. With issuance capped at 21 million coins, bitcoin is positioned as a hedge against currency debasement. Additionally, Morgan Stanley projects $570 billion in AI-related debt issuance throughout 2026, further complicating the macroeconomic landscape.
6Stablecoin Growth and Capital Retention
Stablecoin supply has expanded by 129% since early 2024, reaching a total of $304 billion. Galaxy interprets this growth as capital remaining within the broader crypto ecosystem rather than exiting to traditional markets. This trend mirrors earlier periods where institutional interest in blockchain applications preceded a renewed focus on bitcoin.
7Risk Factors and Potential Setbacks
Despite the bullish outlook, Galaxy identifies several risks that could invalidate the thesis. These include potential AI-assisted theft, broader technology sector downturns, and future quantum computing vulnerabilities. Furthermore, if bitcoin fails to maintain its 50-week moving average or if ETF holdings drop below 1.22 million BTC, the recovery narrative faces significant challenges.
8Strategic Outlook for Investors
The path to $125,000 is supported by diminished selling pressure and a lack of retail crowd participation. Investors should monitor weekly closes relative to the $76,540 moving average threshold. While institutional demand remains the primary driver, the interplay between fiscal policy and emerging technology competition will define the next phase of growth.
Original article: Bitcoin News — Bitcoin Targets $125K as Galaxy Declares Bear Market Over