Bitcoins USD price remains higher than its actual value

Bitcoins USD price remains higher than its actual value


Learn about the realized price metric and how it indicates an average purchase price of Bitcoin, which currently sits just above $21,000 despite the current price being above $26,000.

In recent days, the price of Bitcoin (BTC) in USD appears to be struggling a bit. 

On the other hand, this difficulty is evident only in the short term, because already in the medium/short term things change. 

The concept of discovered price

1 of the metrics that it always pays to keep an eye on is the so- was known discovered price.

This is a metric that broadly signifies the average buy price. 

In reality, it is obtained by dividing the discovered cap by the number of existing coins, and the discovered cap is obtained by multiplying the price of Bitcoin at the time of the last visible move on the blockchain tech by each individual UTXO, and adding it all up. 

UTXO means Unspent Transaction Output, that is, Bitcoin that is cashed in by individual addresses and not is still spent. 

Although while the discovered price does not accurately represent the average buy price, it is perhaps the best estimate we have for being able to imagine an average buy price. 

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Of course, the discovered price likewise includes all the Bitcoin that has been lost over time, so it is a default estimate. 

As of now, Bitcoin’s discovered price is still only just over $21,000. 

Bitcoin (BTC): the average buy price in USD

Despite the fact that this is only a rough default estimate, the $21,200 discovered price is definitely still far below the present price. 

Then once more, although most people purchased Bitcoin in 2021, at the height of the bubble and at prices certainly higher than $21,000, it should not be forgotten that the discovered price only takes into account the likely buy prices of Bitcoin (BTC) that have not is still been spent, i.e., still in the wallet. 

So it excludes, for instance, those who purchased in 2021 and sold in 2022.

Furthermore, for every single Bitcoin sold in 2022 at a low price there is someone who purchased it, precisely at a low price, and whether they still have it in their portfolio affects the discovered price calculation. 

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Added to this is that until 13 January 2023 the price of Bitcoin (BTC) was below the $20,000 mark, and had been since 8 November 2022. 

In the face of this, the estimate suggested by Swift would not appear to be absurd, although it is certainly approximated by default owing to the fact that the Bitcoin lost forever are likewise taken into consideration, which no longer have any value because they are definitely unusable. 

It is worth keeping in mind that there are only 4 Million Bitcoin that do not seem to have been moved to blockchain tech in the past 5 years, and that there are greater than 1 Million that have instead been moved in the past 30 days alone. 

In total there are just under 19.4 Million Bitcoin, and given that, in the a year ago alone, i.e., following the implosion of the Terra/Luna ecological system that caused the price of Bitcoin (BTC) to fall below $30,000, almost 8 Million seem to have been moved, which implies that only slightly greater than half have not moved in greater than a year. 

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On the other side , fewer than 3 Million have moved from May 2020 to May 2022, which is far fewer than those moved in the past 12 months. 

The present price of Bitcoin (BTC) in USD

Not only is Bitcoin’s current price over $26,000 far higher than the present discovered price of about $20,000, but during the last bear-market the price of Bitcoin has only been below the discovered price for about 7 months. Previously it had been over that threshold for greater than two years. 

So it is not at all an anomaly that the price of Bitcoin is over the discovered price, although it is traditionally well over that threshold, and not just by 30 percent as it is now. 

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It is worth keeping in mind that Bitcoin’s discovered price rose over $20,000 for the 1st time in history in April 2021, which was when the 1st speculative bubble that marked the last big bull run was about to end. 

By contrast, in December 2020, when the price had more than $20,000, the discovered price was still below $9,000. Nonetheless, this outlines how fast the discovered price can likewise move, which doubled in about four months in early 2021. 

What is even more interesting though is the fact that it has never had more than $26,000, as Bitcoin’s maximum discovered price was touched in April 2022, at the height of the bear-market, precisely at $26,003. 

And once the price began to fall, at the end of April, the discovered price likewise dropped, until it reached the weakest point of the last bear-market in March in the year, below $20,800. 

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This is why as long as the price of Bitcoin (BTC) stays over $21,000 there appears to be no particular danger in the medium/ longstanding, and as long as it stays over $26,000 likewise, everything is definitely normal.

Source

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