Is the Bitcoin bear market over? Fidelity issues a key warning!

Bitcoin rebounded strongly in August, and Fidelity views the end of the bull market with caution.

Bitcoin showed one of its strongest monthly performances in August since November 2024, regaining market attention. However, Fidelity is cautious about the question of whether the Bitcoin bear market is over. According to its latest quarterly cryptocurrency market assessment report, although the price trend is strong, it is not enough to prove that the current decline cycle is completely over.

Fidelity's analysis pointed out that Bitcoin, Ethereum and some large altcoins have experienced the strongest positive market period since the end of 2025. In particular, Bitcoin achieved a gain of more than 25% in the third week of August alone, which further strengthened market expectations for recovery. Still, the company stressed that the current rally could be either the beginning of a long-term new bull cycle or a brief rebound in a continuing downward trend.

Will November 2026 be the key bottom?

Some investors regard November 2026 as a potential bottom period based on Bitcoin's price cycle pattern over the past four years. Previously, Bitcoin's last major bear market low occurred in November 2022. If calculated based on the same time interval, theoretically the next important low point may occur around November 2026. However, Fidelity made it clear that Bitcoin's historical cycle has never strictly followed a fixed four-year calendar.

Therefore, the company estimates that Bitcoin may have seen the lowest point of the current cycle in July. Of course, there is still the possibility that prices will fall again and reach a new low in November or later. Chris Kuiper, vice chairman of research at Fidelity Digital Assets, said that investors stick to long-term holding strategies is often more effective than trying to accurately capture the absolute bottom. But past performance does not guarantee that the same cyclical pattern will be repeated in the future.

Are changes in volatility supporting the recovery?

Fidelity views Bitcoin's rapid shift from a low-volatility phase to upward movement as a potential signal of recovery. Between June and mid-August, the cryptocurrency market maintained relatively low volatility. Market analysis shows that during this period, the prices of Bitcoin and other digital assets were close to the lower edge of the historical range. The strong rally that followed took on a structure similar to the expansion of volatility near the bottom of some bear markets in history.

Bitcoin quickly broke through US$80,000 and fell back to approximately US$79,250, indicating that there is pressure for pullback under overbought conditions in the short term. However, this technical pullback does not necessarily mean the beginning of a new downward trend. Kuiper also pointed out that some past events that may have put pressure on prices did not prevent the August rally, such as hardware wallet security incidents and delays in the CLARITY Act process that failed to bring prices down, which could be a sign that selling pressure has weakened.

Decoupling growth in digital asset usage from prices

According to Fidelity, despite previous weak prices, usage and adoption rates within the digital asset ecosystem continue. Stability coin trading volume, tokenized real-world assets, and institutional participation all showed growth, even in the context of depressed market values. The company compares transaction and usage data on blockchain networks to core metrics for traditional businesses. The increase in usage reflects the vitality of the ecosystem, but it is not directly equivalent to an inevitable increase in token prices.

Data shows that some Ethereum funds attracted more capital than Bitcoin funds in July, while demand for Bitcoin ETFs strengthened again in August. Fidelity believes that the increase in institutional investment is an important factor supporting a potential bull market in the future.

U.S. regulatory developments may become a new catalyst

In the fourth quarter of 2026, regulatory progress in the United States may have an important impact on the direction of cryptocurrency investment. The CLARITY Act has received bipartisan support and advanced in the Senate Banking Committee with 15 votes in favor and 9 votes against. The bill needs to receive 60 votes in a procedural vote on September 15 to enter debate. The proposal aims to share the regulatory powers of the SEC and CFTC over digital assets, but its final passage is still uncertain and may require review and revision by the new House of Representatives.

In addition, the SEC proposed a new proposal on crypto asset regulation on August 18, aiming to create two different securities registration exemptions for eligible crypto investment contracts. The draft stipulates that eligible projects can raise up to US$5 million over four years, or up to US$75 million over 12 months. The deadline for soliciting public comments is October 20, and the proposal has not yet become the final regulation.

To sum up, although Fidelity admitted that the rebound in August was an important sign of recovery, it still believed that it was too early to conclude that the Bitcoin decline cycle was completely over. Investors should combine adoption data, institutional capital inflows, and U.S. regulatory developments to comprehensively analyze market trends. Please note that this content does not constitute investment advice. There are high risks in the market, so please conduct independent research before making a decision.