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The Bitcoin value has been fascinating to observe over the recent weeks, rebounding significantly from its $74,000 low to surpass the $100,000 threshold once more. Notably, the newest on-chain data indicates that the leading cryptocurrency might be on the verge of reclaiming its present all-time-high price and potentially commence a new bull run.
Bitcoin Value To Mimic Gold’s Path
In a Quicktake article on the CryptoQuant platform, on-chain analyst Ibrahim Cosar presented a data-driven perspective on the possible direction of the Bitcoin value in the upcoming months. The pertinent metric here is the Growth Rate Difference (Market Cap vs. Realized Cap), which examines the variance in the growth pace between an asset’s market capitalization and realized capitalization.
As per Cosar, the Growth Rate Difference metric aids in assessing investor sentiment (whether the market is overly negative or positive) and the differing market cycles. The indicator also facilitates the identification of the relationship between genuine value growth and price growth, whilst evaluating the sustainability of a price trend.
Source: CryptoQuant
As illustrated in the above chart, the positive zone (marked in green) generally indicates bullish market conditions. It implies that the market cap is increasing at a faster rate than the realized cap, with numerous investors entering the arena and securing new positions.
The negative (red) zone corresponds with bearish market conditions and significant price corrections, as more investors liquidate their holdings. As prices fall and loss realization rises, confidence among investors in the market starts to wane.
The highlighted chart illustrates that the Bitcoin value recently transitioned from red (bear market) to green (bull market) in the past days. Cosar posits that this transformation suggests a potential parabolic escalation in BTC’s price — reminiscent of the gold price in recent months.
Bull Cycle May Still Be Active: CryptoQuant CEO
Two months ago, CryptoQuant Founder Ki Young Ju speculated that the BTC price had peaked and that the bull cycle had concluded. Nevertheless, following the remarkable progress of the Bitcoin value in recent weeks, the on-chain analytics specialist has retracted their assertion.
According to Ju, the Bitcoin market has become relatively more varied and appears to be departing from traditional cycle theories. The crypto CEO hinted that previous cycles were dominated by seasoned whales, miners, and new retail investors, while ETF issuers, Strategy (MSTR), and institutional investors are the principal participants in the current cycle.
However, Ju mentioned that the Bitcoin market remains sluggish while absorbing fresh liquidity, even though the latest price movements are extremely optimistic. Therefore, the crypto founder suggested waiting for a more definitive signal before engaging in new market positions.
As of this writing, the flagship cryptocurrency is priced just above $103,000, showing no substantial changes in the past 24 hours.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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