Needham & Company has told clients the recent recovery in cryptocurrency markets appears durable, citing a rotation of capital away from AI equities and commodities toward digital assets. In a Monday note, analyst John Todaro highlighted reduced retail activity in oil and metals alongside regulatory cooling in AI stocks as factors supporting renewed investor interest in crypto.
The firm also pointed to a marked slowdown in bitcoin sales by public companies, treasuries and miners. Public miners offloaded a record 57,000 bitcoin—worth roughly $4.2 billion—during the first half of 2026, while total sales since the start of the fourth quarter of 2025 reached about 69,500 bitcoin. The remaining bitcoin holdings on miners’ balance sheets have declined to approximately 70,000 from a peak of 100,000.
Sentiment indicators suggest the market may be approaching a cycle low. Needham’s proprietary Crypto Euphoria Needham Diagram registered a score of 13, described as “max disinterest,” the lowest since the 2022 bear market—a level the firm associates with market bottoms. The indicator had reached euphoric territory in January 2025 during the meme coin surge, marking the cycle’s peak.
Todaro concluded that the rebound has “legs,” signaling confidence in the sustainability of the current upturn despite prior heavy selling pressure.
