Bitcoin has entered an accumulation phase following its June 2026 low, according to Galaxy's Alex Thorn, even as the asset trades roughly 35% below its October 2025 peak. In market-cycle frameworks, accumulation describes the period after a major low when selling pressure fades and coins gradually shift toward longer-term holders, rather than a phase of immediate price gains.

In a report dated October 22 from Galaxy, a financial services firm focused on digital assets, Thorn cited improving technical indicators, declining institutional selling, and rising U.S. debt levels as the basis for his assessment. He shared the findings on X. Bitcoin traded at $81,391 that Thursday, down from $84,176 the previous day.

Bitcoin Reclaims Key Technical Levels

Thorn wrote that Bitcoin regained its 50-week moving average in September and closed above it for five consecutive weeks through October 18. The cryptocurrency's June low also held near its 200-week moving average, a level that has marked the floor of previous bear markets. The 50-week and 200-week moving averages are long-term trend indicators commonly used to gauge whether an asset is in bullish or bearish territory.

The latest decline followed a 44-week stretch below the 50-week average. According to Thorn, sustained recoveries that followed earlier long periods below this level preceded substantial gains. He cautioned, however, that a weekly close below $76,540 left unrecovered within a month would signal that the latest reclaim had failed.

Thorn also reported that Bitcoin's current drawdown reached 53%, shallower than previous recorded bear markets, in which peak-to-trough declines historically exceeded 75%. Coins involved in the recovery from $58,525 carried an average cost of $74,811.

Institutional Selling Declines as Positioning Shifts

Galaxy's report found that asset managers' net long positions in CME Bitcoin futures fell 57%, from 43,300 BTC to 18,400 BTC. Leveraged funds' net short positions also declined, from 71,400 BTC to 30,600 BTC. CME Bitcoin futures, traded on the Chicago Mercantile Exchange, are a common venue for institutional exposure to the asset. Both trader categories thus scaled back directional exposure, though leveraged funds remained net short in aggregate.

Institutional filings showed that nine major investment firms reduced their holdings by a combined 68,000 BTC. Other reporting institutions, however, collectively increased their exposure, and spot Bitcoin exchange-traded funds — which hold bitcoin directly on behalf of investors and have traded in the United States since their approval in January 2024 — added 87,000 BTC after June's low.

Thorn also highlighted shifting behavior among older coins. Monthly transfers of Bitcoin unmoved for at least five years fell from 67,000 BTC in 2024 to 34,000 BTC in 2026. Transfers of long-dormant coins are a widely used on-chain gauge of long-term holder behavior.

Debt Levels and Broader Market Context

Thorn pointed to U.S. federal debt reaching $40.44 trillion on October 20 and a fiscal 2026 deficit of $1.99 trillion. He argued that rising debt strengthens Bitcoin's appeal as an asset with fixed issuance — a reference to the 21 million-coin supply cap written into Bitcoin's protocol.

He also noted that attention has shifted toward stablecoins, tokenization, and blockchain infrastructure. Stablecoins, digital tokens typically pegged to fiat currencies such as the U.S. dollar and widely used in trading and payments, reached $304 billion in circulation, up 129% since early 2024.

Thorn maintains a bullish outlook, with Bitcoin's prior high of $125,000 serving as a potential recovery reference. Whether that view holds, the report itself supplies the markers to track: weekly closes against its stated invalidation level, ETF flows since June's low, and the path of U.S. fiscal figures.