The Bitcoin market is sending increasingly clear signals that it is approaching the bottom of the current cycle. Two key on-chain indicators — the percentage of supply in profit and the dynamics of hashrate and mining difficulty — have entered zones last seen during the bear market bottom of 2022. This is not just a coincidence, but, in my view, a powerful fundamental argument that we are in the final stage of the correction.
Supply in Profit: Bear Market Zone
The "Supply in Profit" (SiP) metric, which shows the percentage of circulating coins in profit, has dropped to 51.9%. This value has firmly settled in the "bearish zone" (below 55%), where the market historically experiences a bottoming phase. Since June of this year, the indicator has consistently remained in this area, with a downward trend persisting since October.
The current level is approaching the absolute low of the previous cycle — around 44%, which was recorded in 2022. If we extrapolate the historical duration of the bottoming phase (about eight months last time), the current consolidation could extend until September-October. However, the very fact that SiP is in this zone is a clear technical signal that the market is close to exhausting sellers.
Hashrate and Difficulty: Record-Long Compression
The second, equally important signal is the abnormally prolonged decline in hashrate and mining difficulty. After a sharp drop in January-February, both indicators have shown a protracted decline lasting 234 days. For comparison, previous record periods of continuous decline were 64 days (2021) and 86 days (2024).
Such a prolonged compression is extremely rare and, in my view, an unfavorable phenomenon. It points to a fundamental weakening of the network: miners are under serious pressure, and network security, while still at a high level, is in a zone of uncertainty. However, there is another side to the coin. If we see a sustained reversal of these metrics upward, it will become a powerful medium-term signal of renewed interest in the network and the start of a new bullish impulse.
My professional opinion: Both indicators are now working in unison — both holders and the network fundamentals point to the bottom phase of the cycle. The scenario of repeating the 2022 bottom is becoming increasingly likely. But the key point is not to panic, but to closely watch for a reversal in hashrate and difficulty. This signal will be the trigger for the start of a new upward trend. The market is shaking out weak hands, and those who remain calm will find themselves in a winning position.