Here is the historical trend of the Bitcoin market cap to real value ratio (MVRV) on whether the current uptrend is over.
The Bitcoin MVRV ratio can indicate where Bitcoin is in the current cycle
in a new post At X, CryptoQuant founder and CEO Ki Young Ju shared a chart showing the past pattern in Bitcoin's MVRV ratio. particle for direct object MVRV ratio Refers to a common on-chain metric that, in a nutshell, tracks how investors' value of Bitcoin (i.e. market value) compares to the value they originally placed on the asset. Hat noticed).
When the value of the ratio is greater than 1, it means that investors as a whole are in profit mode. On the other hand, it is below the sign, which indicates the dominance of losses in the market.
The version of MVRV Ratio posted by Young Ju is not the normal version, but a modified form called “True MVRV”. This change will only consider data from coins that have been involved in some form of transaction activity within the past seven years.
Coins that are more than seven years old can be lost forever, either because they are forgotten or because their wallet keys are misplaced. As such, True MVRV, which excludes these coins that will likely never recirculate, can provide a more accurate picture of the sector than the standard metric version.
Now there is a graph that shows the trend of this Bitcoin indicator throughout the history of the digital currency:
As shown in the chart above, Bitcoin True MVRV has climbed to relatively high levels during this uptrend. This means that the average investor makes a significant profit.
Historically, the higher the shareholders' interest, the more likely it is to participate in a Mass sale So, whenever the MVRV ratio goes up, it might be a high for BTC.
From the chart, it can be seen that the tops in the past cycles occurred when the index exceeded a certain line. So far, the benchmark has not come close to retesting this level in the last period.
According to the founder of CryptoQuant, the reason the market capitalization has not yet overheated relative to the realized cap is that seven billion dollars of inflows are still coming into the Bitcoin market every week.
If the current cycle is to show anything like previous cycles, then the actual MVRV is high, but not too high, potentially indicating room for BTC remaining in the current uptrend.
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