Bitcoin, the leading cryptocurrency, is facing a period of market uncertainty, according to recent data from CryptoQuant. In a report released on February 23, 2025, analyst “Avacado onchain” highlighted that Bitcoin’s price has been trapped in a range between $90,000 and $106,000 for several weeks. This prolonged period of sideways movement could lead to a months-long consolidation phase, similar to what the cryptocurrency experienced earlier in 2024.

The consolidation phase Bitcoin encountered from March to October 2024 lasted for roughly seven months, before it resumed its upward trajectory in anticipation of the U.S. elections and the subsequent victory of President Donald Trump. However, the current market conditions suggest that Bitcoin might be entering a similar phase of consolidation, which could last longer if the current trends persist.

One of the key reasons for this shift in market sentiment is a decline in network activity. According to CryptoQuant’s report, Bitcoin’s active addresses have significantly dropped from recent highs of over 1.1 million to around 900,000. This decrease in active participation is coupled with a sharp decline in Bitcoin transactions, which have fallen by more than 46%, from over 650,000 transactions to just about 350,000.

This reduction in network activity points to a weakened market sentiment, which has been further exacerbated by the failure of previous bullish narratives. In particular, the optimism surrounding President Trump’s pro-crypto policies has not yielded the expected results, and the ongoing geopolitical uncertainties related to trade wars have added to the negative sentiment.

Another significant factor contributing to Bitcoin’s stagnation is the drop in positive netflows into exchange-traded funds (ETFs). Bitcoin ETFs were expected to provide a boost to the digital asset’s price, but their performance has failed to match expectations. This has led to diminished investor enthusiasm, making it harder for Bitcoin to break free from its current trading range.

The analyst suggests that for Bitcoin to experience another bullish surge, there needs to be either a resolution of the geopolitical uncertainties or the emergence of new bullish catalysts. Until these factors are addressed, Bitcoin’s price may remain constrained within its current range, with limited chances of significant upward movement.

However, not all analysts are in agreement. While the CryptoQuant report paints a cautious picture, some traders are more optimistic about Bitcoin’s short-term prospects. Veteran trader Peter Brandt, for instance, recently suggested that Bitcoin could be poised for a breakout. According to Brandt, the period from February 24 to February 26 could offer crucial insights into Bitcoin’s next move, as he noted internal symmetry in the cryptocurrency’s price range during this time.

As of now, Bitcoin is trading around the $96,000 mark, showing limited price action compared to previous months. The market seems to be waiting for a trigger event, whether it’s a shift in sentiment or a new external factor, to provide the necessary momentum for a breakout or continuation of the current trend.

In conclusion, Bitcoin’s market performance is currently in a phase of uncertainty, with weak network activity and declining sentiment pointing to a potential prolonged consolidation. Investors are closely watching for any signs of change, while some remain hopeful that a breakout could occur in the coming days. Whether Bitcoin will experience a breakout or remain stagnant largely depends on how the broader geopolitical landscape evolves and if any new positive catalysts emerge to reignite investor interest. Until then, Bitcoin’s price may continue to fluctuate within its established range, with no clear direction in sight.