The bulls are waking up, but they are not running yet

Bitcoin and Ethereum have kept much of their recovery from the July sell-off. The price move is clear. But is market activity following it with enough force to call this a broad bull market?

For example, CoinGecko’s analysis classifies Bitcoin as being in a new bull cycle based on its 200-day moving average, while CoinMarketFees’ technical analysis points to bullish signals from the 50-day and 200-day moving averages. At the same time, these analyses come with important caveats about the durability and broader significance of the move.

I’m Evan Ceolini, CEO of SwapSpace, a crypto exchange aggregator. I won’t repeat the technical analysis of Bitcoin’s price. Instead, I’m looking beyond price to examine capital flows, liquidity, on-chain activity, and participation across the broader crypto market, and what these signals may tell us about the next phase of crypto.

Prices have recovered from July, but remain below January

Bitcoin stood at $88,839 on January 1, fell to $60,024 on July 1, and traded near $83,020 on September 28. That is a recovery of about 38% from July, yet it remains roughly 7% below the year’s opening level.

Ethereum followed the same broad path. It moved from $3,004 at the start of January to $1,610 on July 1, then back to around $2,665 by September 28. The rebound from July was stronger than Bitcoin’s, but ETH was still about 11% below its January level.

The recovery is also supported by bullish technical signals. Bitcoin is trading above its 50-day and 200-day moving averages, and CoinGecko classifies it as being in a new bull cycle under its 200-day moving-average methodology. But technical momentum tells only part of the story.

That distinction matters. A price recovery can change sentiment fast, especially after a sharp drawdown. It does not settle the question of whether new capital is moving into the market or whether existing holders are simply repricing risk.

Figure 1. Bitcoin and Ethereum daily prices through September 28, 2026. Source: Binance market data.

DEX volume improved in September, but the rebound was uneven

Average daily DEX volume rose from $6.69 billion in July to $10.39 billion across September 1 to 28. That is a 55% increase. The path was not smooth: average volume increased in August, then September brought several high-volume days alongside sharp pullbacks.

The last daily reading in the dataset was $8.52 billion, below the $10.25 billion recorded on September 1. Uniswap’s daily volume moved from $1.40 billion on July 1 to $2.32 billion on September 28. The rise is meaningful, but it has not yet developed into a sustained upward trend.

Figure 2. Global daily DEX volume through September 28, 2026. Source: DeFiLlama.

USDT and USDC have not returned to their 2026 highs

Stablecoins are an important part of crypto market liquidity, providing dollar-denominated assets that can be used across on-chain markets. The market caps of USDT and USDC, the two largest fiat-backed stablecoins, have recovered from their summer lows but remain below their 2026 highs. Their combined market cap reached roughly $270 billion in the spring, fell during the summer, and stood at $258.34 billion on September 30.

Stablecoins are an imperfect proxy for risk appetite, but the trend is still relevant. The partial recovery in USDT and USDC suggests that the core fiat-backed stablecoin base has not expanded in line with the recovery in crypto asset prices. A broader market expansion would be easier to confirm if stablecoin market cap moved back above its previous highs and continued to grow.

Figure 3. USDT and USDC market cap movement, indexed to September 2025 = 0%. Endpoint labels show the actual market caps in USD billions as of September 30, 2026.

Activity is concentrated rather than broad

USD-denominated TVL can rise with token prices even when the amount of capital committed to an application has not changed. To separate that effect, I compared TVL in the relevant native token and indexed each chain to December 1, 2025.

Base was the clear exception, finishing about 48% above that baseline. Ethereum, Solana, BNB Chain, and Arbitrum all remained below it, with Arbitrum down the most. Activity was concentrated in a smaller number of places rather than spread evenly across the major chains.

Figure 4. TVL in native-token terms, indexed to December 1, 2025. Sources: DeFiLlama and Binance market data.

Lending recovered from July, then slowed

Aave V3 TVL fell from $30.48 billion on January 1 to $11.63 billion on July 1. It recovered to $17.93 billion by September 28, but that was still about 41% below the January level. The gain since September 1 was modest.

Aave is not the whole market, but its TVL is a useful signal of capital returning to DeFi. Borrowing and collateral activity tend to deepen when users are willing to take sustained risk. The recent recovery shows interest returning. It does not yet show the earlier base being rebuilt.

Figure 5. Aave V3 TVL through September 28, 2026. Source: DeFiLlama.

A bull-market call needs more evidence

The market has recovered from its summer lows, but the recovery is not yet broad or persistent enough to call it a new bull market. I would look for three things:

First, stablecoin supply should rise for several months and move above its 2026 range. The current base has supported the rebound but not shown sustained capital growth.

Second, activity should broaden across chains and applications. Base has grown, but several major networks remain below their December baseline. A broader expansion would mean sustained growth in users, transactions, fees, deposits, and borrowing across more of the market.

Third, the recovery should hold when price momentum cools. DEX volume and Aave TVL have recovered, but remain below earlier highs. If capital and usage hold after the initial price-driven attention fades, the recovery would look more self-sustaining.

Together, these signals would show a shift from a price rebound toward broader market expansion. The common thread is persistence: a bull market requires people to keep putting capital to work and using crypto products after the initial momentum fades.

Where the next phase of growth could come from

The first half of 2026 left the market wary. Some Web3 projects closed, and users pulled funds from DeFi protocols as losses mounted. The recovery has reopened attention to crypto, yet the broader adoption data remains incomplete. It has also made room for products that can attract activity for reasons beyond directional token speculation. 

One of those areas is tokenized real-world assets — familiar financial products can create recurring on-chain settlement and collateral use when their distribution and compliance layers work. RWA.xyz put distributed on-chain RWA value at $38.6 billion on September 28, while the number of RWA holders reached 4.85 million. The market remains concentrated across a relatively small number of assets and platforms, but the category is creating measurable on-chain activity beyond another wave of token speculation.

The second is prediction markets. They are already large enough to matter as a product category. Combined monthly volume across Kalshi, Polymarket, and Polymarket US reached $45.3 billion in August, although that was down 14.5% from July after a World Cup-driven surge. The scale shows that markets tied to real-world events can attract substantial activity.

Both examples are incomplete on their own. They show where the next layer of activity may come from, not proof that it has already arrived at market-wide scale.

The bulls are awake. The data still needs to catch up

Late-September data strengthens the case for a recovery. Bitcoin and Ethereum are well above their July levels, DEX activity is higher than it was in mid-summer, and Aave has regained part of its lost TVL. But the broader evidence remains narrow: stablecoin supply has not expanded, Ethereum, Solana, BNB Chain, and Arbitrum remain below their December levels in native-token terms, and lending has not returned to its January base.

The market has moved past the worst of the summer weakness, but durable user activity still has time to develop. I expect the next 12 to 18 months to bring stronger organic growth if activity expands across products and persists beyond a price move. The steadier signal will be new capital, wider participation, and users continuing to engage after volatility cools.

The bulls are awake. They are not running yet.

Disclaimer: This article is for informational purposes only and does not constitute investment, legal, or financial advice. Cryptocurrency markets are volatile. Always conduct your own research before making investment decisions.