CryptoQuant Analysts Predict Crypto Market Recovery After Capitulation Phase
After months of market correction, on-chain data suggests that the crypto market may be nearing the end of its capitulation phase. Analysts from CryptoQuant report that key profit and loss (P/L) indicators have dropped to their lowest levels since the bear market lows of 2018 and 2022 — historically strong reversal zones.
On-Chain Metrics Reach Historic Lows
According to the report, realized profit and loss ratios have fallen sharply, indicating widespread investor capitulation. Similar readings in past cycles have preceded the start of new long-term bullish trends, as weak hands exit and long-term holders begin to accumulate.
The data shows that current market stress mirrors the conditions seen during major bottoms — moments when fear and loss dominate sentiment, but strong holders quietly position for recovery.
Signs of a Market Rebound
CryptoQuant analysts note that if current dynamics persist, the market could begin recovering over the next few months. Stabilizing funding rates, reduced selling pressure from miners, and increasing stablecoin inflows all hint at renewed accumulation behavior.
While short-term volatility remains likely, historical patterns suggest that such on-chain capitulation zones often mark the beginning of major price reversals.
Lessons from 2018 and 2022 Cycles
The 2018 and 2022 cycles both showed similar profit/loss compression followed by powerful uptrends lasting several quarters. In each case, macroeconomic stability and growing institutional interest played a key role in sustaining the rebound.
If this pattern repeats, the current downturn could give way to the early stages of a broader bull market, potentially supported by ETF inflows and increased blockchain adoption.
Outlook
CryptoQuant’s analysis adds to a growing narrative that the crypto market is transitioning from fear to opportunity. As P/L metrics hit bottom and accumulation resumes, the groundwork for the next major uptrend may already be forming beneath the surface.
The next few months could prove pivotal — marking the quiet beginning of a recovery that only on-chain data saw coming.
