To guide and help investors better understand the prevailing state of BTC and the broader crypto market, leading market intelligence platform IntoTheBlock has shared four important bitcoin on-chain metrics to watch.
Bitcoin on-chain metrics to watch
The first BTC on-chain metrics discussed by the analytic platform on Tuesday bordered around bitcoin holders and large transaction volume. According to the update, the number of profitable BTC holders is greater than the unprofitable counterparts as of April 30.
Data showed that 86% of BTC holders were in profit, 12% counting losses and 2% at break-even points when the asset’s price was above $60,500. Of these holders, 69% have held BTC for more than one year, 24% have held between 1-12 months and 7% have held their BTC for less than a month.
The update further showed that over $91 billion worth of BTC was traded between April 23 – 30 in large transaction volume alone — transactions above $100,000. Within that period, BTC inflows and outflows across all exchanges reached $6.05 billion and $5.87 billion, respectively.
Second, IntoTheBlock highlighted the bitcoin market value to realized value (MVRV) ratio. The MVRV ratio is a metric used to evaluate the market valuation of an asset based on the price at which users purchased the asset versus the current price. It helps gauge whether an asset is overvalued or undervalued relative to its historical trading patterns.
At the time, the bitcoin MVRV ratio stood at 2.17, indicating positive investor sentiments on the leading cryptocurrency and a “promising sign in the current bull cycle.”
However, historical patterns show that investors tend to sell off their BTC holdings when the cryptocurrency’s MVRV ratio crosses 3.7 points, making it a must-watch indicator.
Recall that analyst Ali Martinez spotted a prime buying opportunity for Chainlink (LINK) leveraging the MVRV ratio and TD sequential.
Third was bitcoin price volatility. This critical on-chain metric measures the price fluctuations of BTC over time. IntoTheBlock data showed that bitcoin price volatility dropped to 36% as of April 30 after a period of stronger movements. The indicator signals the potential for both risks and rewards for investors.
Lastly, despite the prevailing Iran-Israel conflict in the East and the stiff regulatory conditions in the West, the update showed trading power in the Eastern market was nearly balanced with that in the Western markets. In particular, the weighted average of transactions in the Eastern market was 49.77% in April while the West weighted average was 50.23%.
However, the latest IntoTheBlock data hints at the East gaining an edge over the West in terms of transaction volume. The development is possibly fueled by the kickoff of spot bitcoin and Ether exchange-traded funds (ETFs) in Hong Kong on April 30.
Meanwhile, the West has continued to intensify its crackdown on crypto operations, staying mute on spot Ether ETFs despite approving 11 spot BTC ETFs in January.
In March, the U.S. Securities and Exchange Commission (SEC), issued a Wells notice to Uniswap Labs while still battling with Ripple in a lawsuit bordering around XRP.
Read More: Whales Shift Millions of XRP As Ripple-SEC Legal Battle Intensifies
Crypto market enters mid-bull cycle
The past three bitcoin halvings preceded crypto bull markets. However, since the completion of the fourth block rewards halving on April 19, BTC price has remained in a downtrend.
At press time, the largest cryptocurrency by market capitalization has dipped to $57,300, translating to a decline of over 10% in the past seven and 30 days.
Despite this short-term bearish sentiment on BTC, IntoTheBlock implied that the crypto market has entered a mid-bull cycle, citing the above-mentioned bitcoin on-chain metrics.
“While short-term selling pressure might persist, the broader on-chain data suggest we’re mid-bull cycle with room to grow.,” the market intelligence platform wrote.
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