The realized market capitalization of Bitcoin has just surpassed the 1 trillion USD mark, marking a significant turning point for real money flowing into this market.
The Bitcoin market is currently in a stabilization phase after a period of strong volatility, but indicators suggest that a new wave of volatility may soon emerge, especially if the price approaches the 120,000 USD mark.
MAIN CONTENT
Bitcoin's realized market capitalization has reached 1 trillion USD for the first time, reflecting strong investor confidence.
Trading activity on the network is quieting down, signaling preparation for the next major volatility.
Nearly 2 billion USD in short positions could be liquidated if Bitcoin surpasses 120,000 USD, triggering a strong upward wave.
What is the realized market capitalization of Bitcoin?
The realized capitalization of Bitcoin is the total value of coins based on the last movement, reflecting the amount of real capital actually invested in the network.
Unlike traditional market capitalization, which is based solely on the current price, realized capitalization provides an accurate view of committed capital, reflecting the true financial health of the Bitcoin market. This data helps assess reliability and long-term investment levels rather than short-term price fluctuations.
This index is often used by experts and analytical organizations like CryptoQuant to determine the quality of the capital flow present in the cryptocurrency ecosystem.
What constitutes the 1 trillion USD milestone of Bitcoin's realized capitalization?
Bitcoin's realized market capitalization has reached 1 trillion USD for the first time in history, demonstrating that large-scale real money is flowing into this network.
Statistics from CryptoQuant show that the realized price reflects increasing confidence from the investment community as more BTC is bought and held at high price levels, rather than just trading short-term.
"The fact that Bitcoin's realized market capitalization has reached 1 trillion USD indicates that real money is being poured in, establishing a stronger position in the global market."
– CryptoQuant, Bitcoin Market Report, June 2024
If the upward momentum continues, experts assess that the target for realized capitalization reaching 2 trillion USD is entirely feasible, which will enhance Bitcoin's position and recognition in the international financial market (CryptoQuant, 2024).
Why is the stabilization period of supply important for Bitcoin?
Recent Bitcoin trading has dropped sharply, with exchange activity on the network quieting down after a series of violent fluctuations.
The 30-Day Active Supply index of Bitcoin, compiled by Alphractal, is considered the 'pulse' of investor sentiment. When this index decreases, the market often enters a compression phase with fewer transactions, preparing for the next major volatility cycle.
Market history shows that such cooling periods have often paved the way for significant price surges, as strong demand struggles with limited supply.
What large wave is the Bitcoin market waiting for next?
Nearly 2 billion USD in short positions are 'hanging' around the price level of 120,000 USD, threatening to be liquidated en masse if Bitcoin approaches this mark.
The common scenario in the derivatives market is when large short volumes are 'squeezed', the upward momentum will be even stronger due to the rush of buy orders to cover losses. This event often turns quiet moments into turning points for new growth waves.
"Major short position liquidations are always a catalyst for sudden price spikes of Bitcoin."
– Alphractal, On-chain analysis expert, X, June 2024
The history of many large liquidation orders has witnessed Bitcoin prices breaking out widely, causing the market to shift from a quiet state to extremely active in a short time.
What will happen if the realized market capitalization continues to rise?
If the trend of real money continues to stabilize and grow, Bitcoin's realized capitalization could advance to the 2 trillion USD mark, consolidating its position as the largest cryptocurrency.
This will significantly impact Bitcoin's position compared to global financial assets, while affirming the increasingly clear maturity of the cryptocurrency market in front of institutional and individual investors.
Many large financial institutions like BlackRock and Fidelity have shown a deep interest in the Bitcoin market, increasing the likelihood of a new wave of investment (Source: The Block, 2024).
What factors are directly affecting Bitcoin's price volatility?
Bitcoin's price volatility is currently strongly influenced by investor behavior, particularly the short positions on derivatives exchanges combined with the stability of circulating supply.
When large short positions are opened at sensitive price levels, any strong surge can quickly change the market's state. Particularly, FOMO (Fear of Missing Out) sentiment can trigger additional new capital participation, amplifying the volatility.
Similar price correction, accumulation, and breakout cycles have repeated multiple times in Bitcoin's development history, such as in 2017, 2020, or early 2024 (Glassnode, 2024).
FAQ – Frequently Asked Questions about Realized Capitalization and Bitcoin Trends
How does Bitcoin's realized capitalization differ from market capitalization?
Realized capitalization is calculated based on the value of Bitcoin based on the last movement, while market capitalization is total supply multiplied by the current price. Realized capitalization reflects the real capital that has been invested.
Why is it important that the realized market capitalization exceeds 1 trillion USD?
This milestone indicates that the amount of real money committed in the network has reached a new peak, demonstrating long-term confidence and sustainable market development.
What could happen when large short positions are liquidated?
When short orders are 'squeezed', buying pressure suddenly increases, pushing Bitcoin's price up sharply in a short time as traders have to cover their losses.
What is the current trading activity of Bitcoin?
The market is relatively quiet, with trading significantly reduced compared to the previous period, but this is often a sign preparing for the next major volatility.
How does the trend of real money affect Bitcoin's price?
When realized capitalization increases steadily, the market becomes more stable, creating a foundation for long-term price increases and attracting the attention of large investors.
Source: https://tintucbitcoin.com/bitcoin-vuot-1-000-ty-usd-short-cang/
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