Concerns about the Bitcoin bear market continue to grow. On-chain analyst Willy Woo said BTC remains in Phase 1 of a broader downturn amid the market dip. Woo argued that rising volatility and weakening liquidity confirm the trend. He said internal flow models and volatility metrics now align, pointing to further stress in Bitcoin.
Bitcoin Bear Market Framework Points to Phase 2 Risk
As per Willy Woo, volatility serves as a primary trend detector for quantitative analysts. He said Bitcoin entered a bear market when volatility spiked upward. Volatility has continued climbing, which he said shows the bear trend strengthening. He added that volatility typically peaks mid- to late-cycle before weakening.
Woo explained that smaller secondary volatility peaks often appear near the macro bottom. He said those peaks indicate capitulation across the market. However, he stressed volatility offers only one lens for assessing the Bitcoin bear market. Therefore, he relies on internal liquidity and investor flow models published weekly.
According to Woo, those liquidity models currently reinforce the volatility outlook. He framed the Bitcoin bear market in three phases to clarify positioning. Phase 1 began in Q3 2025 when Bitcoin liquidity broke down, and the price followed lower. He said Bitcoin reacts faster than equities because it remains a smaller, highly sensitive asset.
In Phase 2, Woo said global equities turn bearish as risk appetite fades. He described equities as a large, slow-moving market that eventually confirms broader weakness. Phase 3 begins when liquidity stabilizes and capital outflows peak. He said final capitulation often occurs during that stage.
When asked about his past $200,000 to $300,000 BTC price projection in 2021 by an X user, Woo acknowledged the error. He said derivatives markets changed cycle dynamics and required expanded models beyond on-chain data. He argued that changing market structure influenced price behavior.
Glassnode Flags Demand Exhaustion Near $70K
Glassnode data added context to the Bitcoin bear market outlook. They said every attempt to reclaim $70,000 since early February met demand exhaustion. Notably, even more than $5 million per hour in realized profit led to price rejection.
Glassnode contrasted that with Q3 2025’s euphoric phase. During that period, profit realization surged between $200 million and $350 million per hour. The firm said current thin liquidity conditions make a sustained move into the $70,000 to $80,000 range structurally difficult.
Meanwhile, crypto investor Ran Neuner noted the absence of a blow-off top or retail euphoria. He cited fragmented narratives, including quantum risk and regulation uncertainty. Therefore, he said he reduced exposure and concentrated on 11 positions built to withstand further downside within the ongoing Bitcoin bear market. As Coingape reported, Woo recently warned that advances in quantum computing could threaten Bitcoin’s security model and weaken its edge over gold.
He said markets have started pricing in the risk of a potential “Q Day,” when quantum machines could break current public-key encryption. Woo added that after quantum risks entered investor awareness, the long-standing Bitcoin-to-gold valuation trend broke and moved in the opposite direction.