Bitcoin production cost to identify the end of the bear marketBitcoin all time history indexINDEX:BTCUSDSwissquoteThe price of Bitcoin has been developing its cyclical bear market since the trading session of Monday, October 6, following its cycle peak at 126,000 US dollars. Numerous analytical tools related to the Bitcoin cycle from a time perspective and from a price perspective can be combined to identify, at an early stage, a time window for the end of the bear market and a price zone. These tools are cyclical, technical, and on-chain (analysis of Bitcoin network data), but there are also other, more original approaches. In particular, one approach consists in viewing Bitcoin as a digital commodity (which consumes electricity and computing resources), and therefore, like any commodity, Bitcoin has a production cost. Bitcoin’s price history shows (see the chart attached to this analysis) that bear market lows have historically been formed slightly below this production cost per Bitcoin. In the past, there have often been several weeks of sideways accumulation below this production cost before the bullish trend resumed. If this pattern repeats, Bitcoin could form a major bottom in the price area around 40,000–50,000 US dollars sometime during 2026, before resuming its bullish trend. This production cost chart is provided via an open-source script on TradingView, the details of which are provided below: The chart below shows the weekly Japanese candlesticks of the Bitcoin price, and the purple band corresponds to the production cost per Bitcoin. This approach is based on the idea that marginal production cost acts as a form of long-term economic floor. When the market price of Bitcoin remains sustainably below the average production cost of miners, miners become structurally unprofitable. Historically, these phases of miner stress have coincided with capitulation zones and macro cycle lows. Selling pressure from miners forced to liquidate part of their reserves then tends to gradually dry up. Production cost, however, is not a fixed metric. It evolves according to several dynamic parameters: electricity prices, the energy efficiency of mining hardware, network difficulty, and the geographical structure of the hashrate. As the least profitable miners leave the network during bearish phases, difficulty adjusts mechanically, which helps lower the average production cost and stabilize the ecosystem. This self-adjustment mechanism reinforces the relevance of this indicator in the analysis of capitulation phases. It should nevertheless be recalled that production cost is not a precise timing indicator. It is more of a fundamental valuation zone than an immediate buy signal. Markets can remain irrational longer than expected and trade below production cost for extended periods, particularly in unfavorable macroeconomic environments or during phases of global liquidity contraction. By combining this approach with other cycle indicators, on-chain capitulation metrics, market structure based on price data, and macro context analysis, it becomes possible to better frame zones of risk and opportunity. Production cost then acts as a long-term compass to identify phases where the risk/reward ratio becomes structurally more favorable for the gradual accumulation of Bitcoin. DISCLAIMER: This content is intended for individuals who are familiar with financial markets and instruments and is for information purposes only. The presented idea (including market commentary, market data and observations) is not a work product of any research department of Swissquote or its affiliates. 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