The Potential Level Bitcoin Can Sink To
Amid Bitcoin’s recent struggles, CryptoQuant’s Head of Research, Julio Moreno, has revealed the potential level at which Bitcoin could sink. Moreno explains that he evaluates this by looking at the realized price of 1 to 3 month-old holders.
The Concept of Realized Price
The realized price is an indicator that shows the average price at which investors acquired their Bitcoin. It uses on-chain data to determine the cost basis of holders. When the spot price is above the realized price, it indicates unrealized gains for investors. Conversely, if the spot price is lower than the metric, it suggests that the market is underwater.
Currently, Moreno has applied the realized price to a specific segment of investors: the 1-to 3-month-old holders.
Trend in Bitcoin Realized Price
Looking at the chart below, you can see the trend in Bitcoin’s realized price for this particular group of holders over the past year:
The Current State of BTC Price
Since Bitcoin’s price dropped below $45,000, it has been trading sideways around $42,500.
Hot Take: The Future of Bitcoin’s Price
Based on CryptoQuant’s analysis of the realized price and considering the current correction, there is a possibility that Bitcoin’s price may continue to decline if the correction persists.
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