Bitcoin’s Bull Score Index Plunges to Two-Year Low, Raising Market Concerns

A crucial indicator of Bitcoin’s market strength has hit its lowest level in two years, sparking fears of a possible structural shift in market dynamics.

Bitcoin traded near $84,000 on Friday morning in Europe, down 23% from its January high of $109,000. This sharp drop has unsettled investors, igniting discussions on whether this is a routine correction in an ongoing bull market or the beginning of a deeper downturn.

While such declines are not uncommon in bullish cycles, data from CryptoQuant’s Bull Score Index suggests that the market may be facing more significant underlying weakness.

The index evaluates Bitcoin’s market health based on ten key metrics, including investor profitability, liquidity, and network activity, assigning a score from 0 to 100. A reading above 60 typically aligns with bullish momentum, while sustained levels below 40 often precede bearish trends.

Currently, the Bull Score Index stands at 20—the lowest since January 2023, when Bitcoin hovered near $16,000 following the FTX collapse. Eight of the ten key metrics monitored by the index indicate bearish conditions, with network activity and transaction volumes declining since December 2024.

“Bitcoin has historically required a Bull Score above 60 to maintain upward momentum, while prolonged readings below 40 have often signaled extended bearish phases,” CryptoQuant analysts wrote in a Thursday report.

Investor profitability has weakened, with many short-term holders now sitting on unrealized losses. Meanwhile, U.S. spot Bitcoin ETFs, which had been aggressive buyers, have recorded net outflows of $180 million over the past 30 days—one of the highest withdrawal rates since their launch in early 2024.

Historically, prolonged readings below 40 have preceded extended market downturns, such as the 2022 bear market when Bitcoin lost more than 60% of its value from its peak.

The coming weeks will be critical. If the index rebounds, Bitcoin could regain its bullish momentum. However, if it remains suppressed, the market may be poised for further downside, with the $80,000 support level emerging as a key area to watch.