Fidelity Digital Assets said Bitcoin’s strongest monthly advance since late 2024 does not prove the cryptocurrency has exited its current bear market. In its fourth-quarter crypto market outlook, the firm noted that the late-August surge could mark the start of a lasting recovery or simply a temporary rebound within an ongoing downturn.

Bitcoin rose more than 25 percent in a single week in late August and finished the month with its largest gain since November 2024. Ethereum advanced 34.1 percent and Solana climbed 28 percent over the same stretch. The moves followed several months of relatively quiet trading in which Bitcoin spent much of June and July below $65,000. Prices later traded near $81,000 after briefly touching levels above $82,000, still well below the October 2025 record of about $126,080.

Possible Bottom Timings Still Unsettled

Chris Kuiper, vice president of research at Fidelity Digital Assets, outlined two scenarios. The July low could already represent the cycle trough, or Bitcoin could decline again and establish a new low in November 2026 or later. The November window draws from the approximate four-year spacing of prior major bottoms, the last of which occurred in November 2022.

Kuiper stressed that historical cycles have never followed an exact four-year schedule and therefore offer limited guidance for precise market timing. Investors, he said, have generally fared better by maintaining longer holding periods than by trying to identify exact bottoms.

Volatility Pattern and Market Resilience

Fidelity pointed to a shift from low volatility between June and mid-August into a sharp upward expansion as one feature that has appeared near the end of some earlier bear markets. The firm also observed that potential negative developments, including a hardware-wallet security incident and delays surrounding the CLARITY Act, failed to reverse the August advance. That resilience, Kuiper said, could strengthen the case that cryptocurrencies are approaching a bottom without confirming it.

Network activity and adoption metrics continued to expand even while prices were weaker earlier in the year. Stablecoin transaction volume reached 2.3 times that of Visa, and the market for tokenized real-world assets grew at a faster pace in 2026 than in prior years. Institutional demand showed signs of recovery, with U.S. spot Bitcoin exchange-traded funds recording $731 million in net inflows on September 3.

Policy Calendar as Near-Term Focus

Regulatory developments remain key catalysts for the fourth quarter. The CLARITY Act, which would allocate digital-asset oversight between the Securities and Exchange Commission and the Commodity Futures Trading Commission, faces a procedural vote in the Senate scheduled for September 15. The measure requires 60 votes to advance and still faces an uncertain path to final passage.

Separately, the SEC proposed Regulation Crypto Assets on August 18. The framework would create two exemptions from securities registration for qualifying crypto investment contracts, with offering limits of $5 million over four years or $75 million in a 12-month period under specific conditions. Public comments are due by October 20.

Fidelity listed clearer regulation, monetary policy shifts, broader institutional participation and new blockchain use cases among the factors that could support a renewed uptrend. None of those elements, the firm said, currently confirms that the bear market has ended. Price action and continued adoption data will serve as ongoing tests of the August recovery.