On May 5th, the Bitcoin Risk-Off indicator — a combined analysis tool using on-chain and exchange data to measure price correction risk — dropped to 23.7, the lowest level since March 27, 2019, when Bitcoin was trading around $4,000. Currently, the indicator is in the blue zone, which, according to historical data, is often associated with low correction risk and a high likelihood of an upward trend. Conversely, when the indicator exceeds 60 or turns red, it usually signals higher risk for deep corrections.

In 2019, a similar signal appeared just before one of the strongest bull runs of Bitcoin, paving the way for a surge of up to 1,550%, pushing the price of BTC above $68,000 in 2021.

According to data from CryptoQuant, the Risk-Off indicator is built on the combination of 6 key factors: price volatility (both upward and downward), capital inflows to exchanges, funding rates, OI (open interest) in the derivatives market, and market capitalization. When aggregated, these indicators provide a comprehensive and balanced view of correction risk, making Risk-Off a reliable data-driven tool for market trends.

The last time this indicator signaled a low-risk investment environment, Bitcoin was trading around $4,000. The significant discrepancy from the current price can be explained by various factors, including market development, investor sentiment, and global macro conditions.

The launch of spot Bitcoin ETFs in the United States in 2024 marked an important turning point, opening the door for institutional capital to flow into the market. This event not only increased investment demand but also contributed to stabilizing Bitcoin prices through a transparent and regulated investment mechanism. As of now, ETFs and public companies hold about 9% of the total Bitcoin supply, indicating the increasing participation of traditional financial institutions.

Data from Fidelity Digital Assets shows that the volatility of Bitcoin has significantly decreased compared to the early days. From triple-digit volatility in its early years, this metric has dropped to 3 to 4 times lower than traditional stock indices. Specifically, in the period from 2019 to 2025, the actual annual volatility over a 1-year frame has decreased by more than 80%, as shown in the chart below.

The Bitcoin market today is more mature, with the ability to absorb large capital flows without causing strong price volatility as before. Thanks to increasingly widespread acceptance, clearer regulatory frameworks, and Bitcoin's reinforced role as a hedge against inflation, the intrinsic value of this asset has significantly increased — while also establishing a much stronger price floor compared to 2019.

The Macro Chain Index (MCI) — a composite indicator that combines macroeconomic and on-chain data — has just issued a buy signal for the first time since 2022, when it accurately predicted the market bottom at $15,500.

In the past, the RSI crossover of the MCI has often been a leading signal for explosive growth phases, exemplified by the over 500% increase in 2019. This time, along with increasing OI in the futures market and a positive funding rate, the MCI paints a picture indicating that Bitcoin is entirely capable of surpassing the $100,000 mark in the coming weeks.

However, anonymous analyst Darkfost warns that Bitcoin's network activity is showing signs of weakening — with transaction volumes and the number of active addresses dropping sharply since December 2024. Additionally, the decline in the UTXO metric also reflects a stagnation in demand for block space — a characteristic pattern of a bear market.

However, Darkfost emphasizes that these signals do not imply a negative outlook. On the contrary, macro indicators continue to maintain a strong upward trend, suggesting that the current correction phase could be a strategic opportunity for long-term investors.

Disclaimer: This article is for informational purposes only and is not investment advice. Investors should do their own research before making decisions. We are not responsible for your investment decisions.

$BTC $ETH $