BlockBeats news, on February 9, CryptoQuant analyst Darkfost said that the Bitcoin Sharpe ratio, used to measure risk and potential returns, has been in negative territory, consistent with the characteristics of the late stage of a bear market. But this does not mean that the bear market has ended, but rather indicates that it is approaching a point where the risk-return ratio becomes extreme. The current Bitcoin Sharpe ratio is -10, the lowest level since March 2023.
Looking back at historical data, the Bitcoin Sharpe ratio hit its lowest points at the end of 2022 and the beginning of 2023, as well as at the end of 2018 and the beginning of 2019, both of which were the troughs of previous bear markets. The Sharpe ratio most recently dropped to zero in November 2025, at which time the price of Bitcoin also reached a local low of $82,000. Analysts say that a negative Sharpe ratio usually signals an impending market turning point.