BTC Bulls Face Pressure as CryptoQuant’s Bull Score Index Drops to 2-Year Lows

Bitcoin’s Market Health Deteriorates as Bull Score Index Hits Two-Year Low

A key indicator tracking Bitcoin’s market health has plunged to its lowest level in two years, raising concerns about a potential shift in market dynamics.

Bitcoin traded at approximately $84,000 on Friday morning in Europe, marking a 23% decline from its January peak of $109,000. This sharp drop has sparked debate on whether it signals a temporary correction or the onset of a prolonged bearish phase.

While past bull markets have endured similar drawdowns, on-chain data from CryptoQuant’s Bull Score Index suggests that this downturn may reflect deeper structural weaknesses.

The index, which assesses Bitcoin’s market conditions based on ten key factors—including network activity, investor profitability, and liquidity—assigns a score from 0 to 100. A reading above 60 typically signals a strong bull market, whereas sustained readings below 40 often align with bearish trends.

Currently, the Bull Score Index sits at just 20—the lowest level recorded since January 2023, when Bitcoin was valued near $16,000 following the collapse of FTX. Eight out of ten key metrics tracked by the index are flashing bearish signals, with declining network activity and weakening liquidity since December 2024.

“Bitcoin has historically needed a Bull Score of at least 60 to sustain significant price rallies, while prolonged periods below 40 have been associated with bear markets,” CryptoQuant analysts noted in a Thursday report.

Investor profitability has also taken a hit, as short-term holders face mounting unrealized losses. Moreover, U.S. spot Bitcoin ETFs—once strong buyers—have registered net outflows of $180 million over the past 30 days, marking one of the highest withdrawal rates since their launch in early 2024.

Historically, sustained readings below 40 have preceded extended bearish periods, such as the 2022 market downturn when Bitcoin lost over 60% of its value from peak levels.

The next few weeks will be pivotal. If the index rebounds, Bitcoin could regain upward momentum. However, if the score remains depressed, the market could see further downside, potentially testing the critical $80,000 support level that analysts are closely monitoring.