Bitcoin
Reached new high times just over $ 112,000 Wednesday, although the increase was only marginal compared to the previous top. Despite the wave of bullish business recording, public companies added bitcoin to their balance.
Data on the chain suggests that Bitcoin has more room to run compared to previous cycling heights. A useful metric in this analysis is MVRV Z-score, which helps evaluate whether Bitcoin is overrated or underestimated in relation to what could be considered its fair value.
Unlike a traditional Z-score, MVRV Z-score compares unique market value with the realized value. When the market value, calculated as the network’s valuation based on the spot price, multiplied with the supply, sits significantly above the realized value that reflects the cumulative capital flow to the asset, this has historically signaled market tops [red zone]. Conversely, when the market value is far below the realized value, it has often indicated market -bound [green zone].
MVRV Z-score is defined as the relationship between the difference in market hood and realized cap and standard deviation for market capital, expressed as [market cap minus realized cap] Divided by the standard deviation for market capital. The standard deviation is calculated cumulatively from the first available data point to today, making it a long -term measure.
Currently, MVRV Z-score is 2.4. In earlier Bear Market slavers, Bitcoin has registered scores below zero, as seen in 2015, 2019 and 2022. Meanwhile, cycle plates have historically taken place when the scoring reaches 7 or higher, as was the case in 2017 and 2021, according to Glassnode data.
While this is only a data point, it indicates that Bitcoin still has significant potential for additional upside compared to previous cycles.
Read more: This chart points to a 30% Bitcoin price Boom ahead: Technical Analysis
