Crypto prices may be approaching a turning point after months of losses as several recent developments could mark the start of a new bull phase.

In a note on Wednesday, Clear Street analyst Owen Lau said the roughly 44% drawdown in crypto markets between Oct. 10 and Feb. 28 may now represent the end of the latest downturn. If that stretch represented a crypto winter, he wrote, “so be it.”

Lau didn't provide a price target for bitcoin but argued that sentiment and fundamentals have both improved in recent weeks, pointing to regulatory momentum in Washington, deeper integration between crypto firms and the traditional financial system and continued institutional adoption.

“The industry may just hit an inflection point, and we believe this run has legs,” he wrote.

The comments come as the market has started to rebound. Bitcoin BTC$73,289.20 has risen about 11% over the past week and 8% in the past 24 hours as tensions in the Middle East intensify. The rally has pushed the largest cryptocurrency closer to what many traders view as a key resistance level around $75,000.

Lau also said that U.S. President Donald Trump’s Tuesday intervention on the hard-fought, but currently stalled, CLARITY Act raises the odds that the law wins Congressional passage by the end of the summer. A catalyst, which JPMorgan had said could be the spark that the digital assets market needs for a rally.

Additionally, infrastructure integration is also advancing after Kraken’s banking subsidiary received a Federal Reserve master account, allowing it direct access to the central bank’s payment system. Lau said the move represents a structural step toward integrating crypto-native institutions into the U.S. financial system.

If that's not enough, Lau also pointed out rising institutional participation as another potential catalyst for the rally. Morgan Stanley recently amended a filing for a proposed spot bitcoin ETF to name Coinbase Custody as a co-custodian alongside Bank of New York Mellon, reinforcing Coinbase’s (COIN) role in the institutional crypto ecosystem.

Lau, who covers several major crypto firms, including Coinbase (COIN), Circle (CRCL) and Bullish (BLSH), currently has a Buy rating on Coinbase and Bullish, and a Hold rating on Circle.

'Bull trap'

However, not everyone is convinced that the rally marks the start of a sustained recovery.

Some traders warn the latest move could turn into a classic bull trap — a brief breakout that attracts buyers before reversing lower.

Analysts have pointed to heavy overhead supply and positioning in derivatives markets as potential risks, with some suggesting a rally into the $72,000 to $76,000 range could draw sellers rather than confirm a durable uptrend.

Lau, on the other hand, believes the recent developments could signal a broader shift for the industry.

“The industry may just hit an inflection point, and we believe this run has legs,” he wrote.

Read more: Bitcoin 'air pocket' above $72,000 could mean quick run to $80,000