It’s intriguing how Bitcoin’s on-chain metrics often highlight the ebbs and flows of the market, particularly acting as indicators during bear markets. To delve into a current snapshot, we can explore just how far Bitcoin’s price is from a significant on-chain level right now.
Ki Young Ju, founder and CEO of CryptoQuant, has recently shed some light on the current status of the Realized Price across various key Bitcoin investor categories. The Realized Price is essentially an on-chain indicator reflecting the average cost paid by investors on the BTC network. When Bitcoin’s market price surpasses this figure, it typically indicates that investors, on average, are in profit. Conversely, when the market price remains below this point, it suggests that the majority are experiencing losses.
Analyzing the chart provided by Young Ju can give us a clearer picture of the Realized Price trend for four specific Bitcoin cohorts. As illustrated, Bitcoin’s current trading price has indeed surpassed the Realized Price for all these groups, implying that they are sitting on unrealized gains.
Historically, the Realized Price marks for these cohorts have been pivotal for cryptocurrency trends. Specifically, whenever Bitcoin’s market price exceeded the Realized Price of the “New Whales” (indicated in orange on the chart), it has often been a harbinger of bullish behavior. These “New Whales,” or Short-Term Holder Whales, are investors who acquired their BTC within the last 155 days and hold more than 1,000 coins. Presently, the Realized Price for this cohort stands at $89,300. A continued bearish trend could see Bitcoin re-evaluate this line.
Nevertheless, a dip below this level doesn’t automatically trigger a bear market alert. It could, instead, highlight a momentary lack of momentum. The more critical threshold Bitcoin must maintain to stave off a bearish condition belongs to the Miner Whales (shown in green).
Miner Whales are essentially mining companies with wallets holding over 1,000 BTC. As explained by Ju, past cycles have shown that dips below the Realized Price for these miners have typically ushered in bear markets. As of now, the Realized Price for these Miner Whales is around $58,000. For Bitcoin to challenge this level, it would require nearly a 40% drop from its current pricing, suggesting that, at this point, BTC is comfortably above this potential bear market threshold.
Interestingly, throughout the cycle, Bitcoin has occasionally dipped below the cost basis for three of these cohorts. Yet, it has historically remained above the Realized Price of the Old Whales, or Long-Term Holder Whales, who have been hodling their Bitcoin for more than 155 days. Their average acquisition sits at about $26,000 lately.
In terms of Bitcoin’s price movement, there was a notable tumble below $94,000 recently. However, Bitcoin has rebounded to $96,200, suggesting it might be stabilizing after this brief dip.
Charting tools and insights like TradingView depict that overall, Bitcoin’s price has hovered relatively stable over the past five days.
Featured images are courtesy of Dall-E and CryptoQuant.com, with charts from TradingView.com.
