Bitcoin on-chain metrics are repeating the bottom patterns of 2022: a fundamental reversal signal.
Key on-chain indicators for Bitcoin are showing a frightening similarity to levels observed during the bear market bottom of 2022. The supply in profit has dropped to a critical level of 51.9%, entering the "bear zone," while the hash rate and mining difficulty are experiencing a record-long decline of about seven months.
These two, seemingly independent indicators, are actually closely related. One reflects the psychological state of holders and the current phase of the market cycle, while the other reflects the fundamental resilience of the network. Their synchronized movement toward extreme values is not a coincidence, but a powerful signal that the market is approaching the final stage of a downward trend.
Supply in Profit: A Repeat of the 2022 Scenario
The "Supply in Profit" (SiP) metric shows the percentage of all circulating bitcoins that are in profit based on their acquisition price. Values above 80% traditionally correspond to a bull market and euphoria, the 55-80% range is a transitional phase, and levels at 55% and below indicate a bear market and bottom phase.
The current value of 51.9% confirms that the market has firmly settled into the bear zone. The downward trend for this indicator has persisted since October 2025, steadily approaching the ~44% mark that marked the absolute bottom of the 2022 cycle. In the previous cycle, the bottom phase lasted about eight months. If this historical benchmark is applied to current data, the current phase could extend until September-October.
Record Hash Rate Decline: 234 Days of Continuous Compression
The second critical signal is the dynamics of mining difficulty and hash rate. Both indicators continue to decline within a global structural trend following sharp drops in January and February. The key difference in the current situation is that the decline is lasting noticeably longer than all previous corrections.
Historically, continuous hash rate declines lasted 64 days (May-July 2021) and 86 days (April-July 2024). The current decline has already stretched to 234 days—about seven months of continuous compression. For Bitcoin, such a prolonged decline in difficulty and hash rate, which reflect network security and fundamental resilience, is an extremely unfavorable signal.
However, as I have repeatedly noted in my analyses, it is precisely in such moments that the foundations for future growth are laid. If a sustained upward trend takes hold in these indicators, it will become an important medium- and long-term signal of renewed interest and network expansion.
My professional opinion: The synchronized decline of both indicators—holders and network fundamentals—to levels close to historical lows is a classic sign of a macroeconomic bottom forming. The market is currently in a zone of maximum capitulation, and it is precisely during such periods that experienced investors begin to accumulate positions. We await confirmation in the form of a hash rate reversal.