Bitcoin's Bottom Could Be Lower Than $60K: What Galaxy Digital's Analysis Reveals

Galaxy Digital’s latest analysis suggests that Bitcoin’s bottom—the lowest point before recovery—may be significantly deeper than many investors anticipate. According to the investment firm founded by billionaire Mike Novogratz, the cryptocurrency could fall to $56,000, with a potential range of $56,000 to $58,000 representing a critical floor based on historical patterns and current market structure.

The analysis is grounded in a striking historical pattern: except for 2017, every time Bitcoin has declined 40% from its peak, it has continued falling more than 50% over the following three months. With Bitcoin dropping from its late-2025 high of $126,000 to current levels near $70,800, the $56,000-$58,000 zone increasingly looks like where the bottom could form.

Understanding the Bear Case: Why Galaxy Expects Continued Weakness

Galaxy’s bearish outlook rests on several interconnected factors. First, Bitcoin has failed to establish itself as a reliable hedge against currency devaluation—a role many had hoped it would fill. Second, despite expectations that regulatory progress (specifically the CLARITY Act) would boost crypto markets, analysts note that even if passed, such legislation would likely benefit alternative coins more than Bitcoin itself.

Perhaps most concerning to technical traders: Bitcoin exchange-traded funds (ETFs) have experienced massive outflows. The last two weeks of January alone saw $2.8 billion in net redemptions, ranking among the worst periods in ETF history. This represents a troubling shift from earlier institutional enthusiasm.

Calculating backward from ETF capital flows, Galaxy determined that major fund holders accumulated Bitcoin at an average price of approximately $84,000 throughout 2024. The fact that Bitcoin has struggled to stay above this cost basis—a level it hasn’t traded below since late summer 2024 when the premium was about 10%—suggests this price point could become meaningful support. However, the weakness below $84,000 raises questions about where genuine accumulation might resume.

Technical Levels: Where Bitcoin’s Bottom Could Actually Form

Beyond sentiment and capital flows, Galaxy’s analysts identified specific price zones using blockchain data and moving average analysis. The methodology centers on “realized price”—essentially the average price at which Bitcoin holders last moved their coins. This figure helps determine whether current holders are in profit or sitting on losses.

During past bull markets (2013-2014, 2017-2018, 2019, and 2021), the 50-week moving average consistently acted as dynamic support. Bitcoin broke below this level in November 2025 and is now approaching the 200-week moving average, which sits in the $56,000-$58,000 range. Historically, this zone has marked cycle bottoms and reversals.

Another critical detail: Galaxy identified a major gap in Bitcoin buying between $70,000 and $80,000. Relatively few investors accumulated Bitcoin at these levels, which means support here is weak. In contrast, significant purchases occurred in the $80,000-$92,000 range—coins that could create strong resistance if price recovers.

The ratio of Bitcoin held at lower prices versus higher prices relative to current market value stands at 56% to 46%. Galaxy notes this metric has historically converged toward 50/50 at cycle bottoms, suggesting the floor may be closer than the numbers appear.

What Happened to Galaxy’s Bullish Forecasts?

Last year, Galaxy Digital was notably bullish. The research team predicted Bitcoin would surge above $150,000 in H1 2026 and reach $185,000 by year-end, betting on accelerating institutional adoption and government acceptance of digital assets. That optimism has clearly faded.

In November 2025, Galaxy cut its forecast to $120,000, citing deteriorating momentum and shifting market structure. Capital that had flowed into cryptocurrencies redirected toward traditional assets, while investor confidence wavered. The shift from $185,000 targets to warnings about $56,000 levels represents a dramatic recalibration—but one increasingly supported by on-chain data and market structure analysis.

As Bitcoin trades near $70,800 (down 43.8% from the $126,000 peak), the gap between current price and Galaxy’s predicted bottom continues to narrow. Whether $56,000-$58,000 truly marks Bitcoin’s bottom remains to be seen, but the technical setup, ETF dynamics, and historical precedent suggest that finding this support level could be essential for confirming a sustainable recovery.