Grayscale is confident that Bitcoin is nearing the end of its bear market amid record adoption. According to the digital asset manager, the wallets with non-zero Bitcoin balances have edged closer to the 60M mark.
For Grayscale, this meant strong adoption despite the prolonged crypto winter that began last October. The firm’s Head of Research, Zach Pandl, reiterated that the adoption will accelerate in the medium and long term regardless of the current price action.
The Bitcoin bear market has not changed our expectation for rising Bitcoin adoption over time.
Grayscale: 3 catalysts will drive Bitcoin adoption
Grayscale’s Zach Pandl added that three factors will drive BTC’s next wave of adoption. First, its demand will be accelerated by the need for scarce assets or the so-called store of value assets.
In other words, BTC could become a ‘digital gold’ again as investors seek to hedge against currency devaluation and fiscal debt. The U.S. fiscal debt debate is back in the headlines as it nears $40T.
Worse still, U.S. debt has been doubling every decade regardless of which party is in office.
This directly impacts purchasing power through a devaluation of the U.S. dollar over time. The wealth stored in U.S. dollars is also affected over time. To mitigate this and preserve wealth, investors could opt for gold and other alternative stores of value such as Bitcoin.
Interestingly, the current BTC-gold positive correlation supports Grayscale’s store of value thesis. The correlation is now back to levels last seen in 2025.
Pandl also believes the growing blockchain adoption, as seen by stablecoins, and rising demand for crypto ETFs will also boost BTC adoption. In fact, even the record low BTC volatility suggests that the asset may be gearing for a massive recovery.
Despite the positive outlook in the mid and long run, BTC faces short-term headwinds.
Bitcoin’s short-term headwinds
For starters, BTC is still consolidating below $70K, and the demand is purely speculative and driven by the Futures market.
For sustainable rallies and recoveries, historical data shows that both Spot and Futures market demand must be positive. Currently, Futures demand is positive while spot is negative, signaling risks to any upside move.
Besides, the post-quantum upgrade debate will intensify in 2027, and the resulting FUD could spill over to BTC’s sentiment.
Overall, BTC adoption has remained resilient despite it dropping by half from over $126K to below $60K. For Grayscale, this is a positive signal in the long run. But Spot demand was still negative and could stall BTC in the short term.
Final Summary
- BTC holders are near the 60 million mark, and its store of value narrative could help fuel its next upside move.
- But the current short-term BTC price is driven by Futures demand only, which isn’t sustainable for a strong recovery.
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