Bitcoin’s Established Cycle Faces Unprecedented Disruption

Bitcoin CRYPTO000BTC

The beginning of the 2026 trading year finds the flagship cryptocurrency in a challenging position. For the first time in its history, Bitcoin has posted a loss during a "post-halving year," calling into question the reliability of its well-documented four-year cycle. As the price attempts to find a base after slipping below the $100,000 threshold, a sustained exodus of capital from institutional investment vehicles is hampering any meaningful recovery.

Beyond market dynamics, the regulatory landscape is adding another layer of complexity. The OECD's "Crypto-Asset Reporting Framework" (CARF) took effect on January 1, 2026, across 48 jurisdictions, standardizing the automatic exchange of tax information for crypto transactions. In the United States, attention is shifting to the Securities and Exchange Commission (SEC), where the departure of Commissioner Caroline Crenshaw has created a Republican majority. Market observers anticipate this shift will lead to a change in the regulatory enforcement approach in the medium term.

Institutional Exodus Drives Weakness

The current market softness is primarily attributed to persistent selling by institutional players. U.S.-listed Bitcoin ETFs recorded their worst performance since inception in the final two months of 2025. A combined total of approximately $4.57 billion flowed out of these products during November and December.

On the last trading day of the previous year alone, outflows surpassed $348 million, led by redemptions from heavyweight issuers BlackRock and Ark Invest. On-chain data corroborates this trend: rather than the accumulation hoped for by retail investors from "whales" (large holders), these major players are instead using current price levels to reduce their exposure.

Critical Technical Levels Under Pressure

The technical picture grew more precarious at the start of January. Bitcoin is currently trading within a narrow range, testing a crucial long-term moving average—the 20-month Exponential Moving Average (EMA)—around $88,000. Chart analysts view this level as a final defensive line against a potential deeper correction toward the April 2025 lows near $74,500. On the upside, the $90,000 mark has proven to be a stubborn resistance level, where recent recovery attempts have faltered. Trading nearly 28% below its 52-week high, the path to new all-time records remains a considerable distance away.

Outlook: Bearish Signal Looms

The situation is expected to remain tense in the coming weeks. From a technical perspective, a weekly "Death Cross" is threatening to form, a pattern where short-term moving averages cross below their long-term counterparts, which is traditionally viewed as a bear market signal. To avert a test of the $70,000 region in the first quarter of 2026, the critical support zone between $85,000 and $88,000 must be defended decisively.