Don’t Call Bitcoin Bottom Just Yet, CryptoQuant Head Says: Here’s Why

Source Newsbtc

The Head of Research at CryptoQuant has revealed why it may be too early to call a bottom for Bitcoin, based on the trend in on-chain data.

Bitcoin MVRV Z-Score Has Plunged Under Its 365-Day MA

In a new post on X, CryptoQuant Head of Research Julio Moreno has talked about why Bitcoin may not have reached a bottom yet. “All valuation metrics are in correction territory,” notes the analyst. “It can take more time.”

An indicator that Moreno has cited as an example of this trend is the Market Value to Realized Value (MVRV) Z-Score. This metric basically tells us about how the market cap of the asset compares against its realized cap.

The “realized cap” is an on-chain capitalization model that calculates the total value of the BTC supply by assuming that each token in circulation has its ‘true’ value equal to the spot price at which it was last transacted on the blockchain.

In other words, the realized cap sums up the cost basis of the cryptocurrency’s supply. As such, the model can be interpreted as a measure of the total amount of capital the investors as a whole have put into BTC.

Since the MVRV Z-Score compares the market cap, which represents the value the investors are holding right now, against this initial investment, it tells us about the profit-loss status of the cryptocurrency’s user base.

The MVRV Z-Score is similar to the popular MVRV Ratio, but where it differs from the latter is that it also applies a standard deviation test to pull out the extremes from the data.

Now, here is the chart shared by Moreno that shows the trend in the Bitcoin MVRV Z-Score, as well as its 365-day moving average (MA), over the last few years:

Bitcoin MVRV Z-Score

As displayed in the above graph, the Bitcoin MVRV Z-Score has recently witnessed a sharp decline. The reason for this drawdown naturally lies in the crash that the asset’s price has just gone through, which has put many investors into a state of loss.

Despite the plummet, though, the metric remains above the zero mark. Below this level, the overall market enters into a state of loss, so the boundary has historically proven to be an important one for the cryptocurrency.

An important level that the metric has indeed lost, however, is the 365-day MA. As the analyst has highlighted in the chart, past breakdowns of the line have generally led to notable periods of struggle for the Bitcoin price.

It only remains to be seen how long BTC would have to stay under the level this time around, before its price reaches a bottom.

BTC Price

At the time of writing, Bitcoin is floating around $86,300, down more than 11% over the last seven days.

Bitcoin Price Chart
Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Nvidia stock sinks 4% as Trump’s tariff plans rattle AI tradeNvidia shares fell over 4% early Monday after US President Donald Trump delivered a stern message about trade tariffs. Trump said on Sunday that no country would be given any special treatment regarding tariffs. He also signed new trade policies into effect on April 2, which he calls “Liberation Day.” This frightened investors, who had […]
Author  NewsBTC
Apr 01, Tue
Nvidia shares fell over 4% early Monday after US President Donald Trump delivered a stern message about trade tariffs. Trump said on Sunday that no country would be given any special treatment regarding tariffs. He also signed new trade policies into effect on April 2, which he calls “Liberation Day.” This frightened investors, who had […]
placeholder
Bitcoin Price Bounces Back—Can It Finally Break Resistance?Bitcoin price started a recovery wave above the $83,500 zone. BTC is now consolidating and might struggle to settle above the $85,500 zone. Bitcoin started a decent recovery wave above the $83,500
Author  NewsBTC
Yesterday 03: 37
Bitcoin price started a recovery wave above the $83,500 zone. BTC is now consolidating and might struggle to settle above the $85,500 zone. Bitcoin started a decent recovery wave above the $83,500
placeholder
Bitcoin Price Struggling but Short-Term Holders Might Be Setting the Stage for $150KBitcoin has recently displayed signs of upward momentum, trading at $85,215, marking a 2.2% increase in just the past day. Despite this short-term gain, the asset remains down by over 21.2% from its
Author  NewsBTC
23 hours ago
Bitcoin has recently displayed signs of upward momentum, trading at $85,215, marking a 2.2% increase in just the past day. Despite this short-term gain, the asset remains down by over 21.2% from its
placeholder
U.S. March Nonfarm Payroll Preview: Even If Data Aligns with Expectations, Financial Markets May Not Escape the Fate of VolatilityOn 4 April 2025, the United States will release its March Nonfarm Payrolls (NFP) data. The market consensus currently anticipates job growth of 128,000, a decline from February’s 151,000 (Figure 1). W
Author  TradingKey
22 hours ago
On 4 April 2025, the United States will release its March Nonfarm Payrolls (NFP) data. The market consensus currently anticipates job growth of 128,000, a decline from February’s 151,000 (Figure 1). W
placeholder
Gold price stabilizes ahead of Trump's tariffs announcement on “Liberation Day”Gold price (XAU/USD) stabilizes just above $3,130 at the time of writing on Wednesday following a mean reversal move the prior day after a fresh all-time high got eked out at $3,149 before closing in negative territory.
Author  FXStreet
21 hours ago
Gold price (XAU/USD) stabilizes just above $3,130 at the time of writing on Wednesday following a mean reversal move the prior day after a fresh all-time high got eked out at $3,149 before closing in negative territory.
goTop
quote