The Market Value Realized (MVRV) Ratio of Bitcoin Drops to Its Lowest Annual Levels: Is It a Buying Opportunity?
According to a report by “CryptoQuant,” the cryptocurrency market is currently experiencing a state of overselling following a strong correction.
Short-term Bitcoin holdings (less than a month) saw a notable increase in March and December 2024, reaching 23% and 24.5% respectively, coinciding with the market downturn and pushing the Market Value Realized (MVRV) ratio to a level of 1.8, which is close to the lowest level recorded this year at 1.71.
Analysts believe that if Bitcoin continues to drop to the $70,000 range, the MVRV ratio may decline to the levels seen in the market's lowest correction points.
However, this sharp decline may signal that the market has already experienced extensive liquidation of investment positions, which could provide a suitable foundation for an upcoming recovery without the need for further severe downturns.
Currently, the market is in the final stage of the bullish cycle, characterized by increased risks and unstable investment conditions.
According to “CryptoQuant,” monitoring fundamental factors such as volume and strength of recovery, whale movements, changes in network data, and correlation with traditional markets will be essential to determine the future direction of Bitcoin's price.