Bitcoin experienced major setbacks in the first quarter of 2025. After reaching an all-time high of over $109,000, the leading cryptocurrency dropped and remained on a downward trend until mid-March.

Following a recent recovery above $88,000, BTC finds itself at a crucial stage in its market journey.

Market Health and Future Direction

CryptoQuants Bitcoin Combined Market Index (BCMI) is revealing crucial insights into the assets market health. The BCMI integrates a mix of on-chain and sentiment metrics, including MVRV (30%), NUPL (25%), SOPR (25%), and Fear Greed (20%). Each metric has specific minimum and maximum thresholds.

A reading below 0.15 indicates extreme market fear, often seen as an oversold condition and a potential buying opportunity, while a reading above 0.75 signals strong market greed, usually preceding market tops or corrections. Currently, the BCMI is below 0.5, which indicates that Bitcoin is not yet in an overheated state.

This positions the market at a critical crossroads, which essentially suggests two possible scenarios. In Scenario A, the market could be experiencing a normal correction in the midst of an ongoing bull run. Such a trend may provide a potential buying opportunity before a further price increase.

On the other hand, Scenario B presents the possibility of an early market downturn, which signals the end of the current bull cycle and the potential onset of a bear market.

As such, CryptoQuant advised,

Watch closely for clear directional cues from the BCMI’s 7-day 90-day moving averages.

GameStops BTC Addition Could Rekindle Retail Speculation

Bitcoin has seen dramatic fluctuations following President Trump’s re-election. So far, his presidency appears to have been fostering an environment conducive to Bitcoins growth. For instance, video game retailer GameStop announced this week that its board has unanimously approved a plan to buy Bitcoin with its corporate cash,

As such, QCP Capital sees scope for Bitcoin to outperform tactically in the near term. In its latest update, the digital asset trading firm said that GameStops decision to add Bitcoin to its treasury, which, although not the first instance of corporate adoption, carries significant symbolic weight due to GameStops meme status.

As history shows, coordinated retail investment can challenge institutional control, as evidenced by the 2021 market surge.