On-chain data shows the true market mean price of Bitcoin is valued at $29,700 right now, making the level of particular significance for the coin.<\/p>\n
In a new post<\/a> on X, the lead on-chain analyst at the on-chain analytics firm Glassnode, \u201cCheckmate,\u201d pointed out how the BTC price currently trades below the true market cost basis.<\/p>\n The \u201cmarket cost basis\u201d refers to the average price at which the investors in the sector bought their coins. One popular way of calculating this cost basis is through the \u201crealized cap<\/a>,\u201d which measures the total value of the cryptocurrency by assuming that the price at which each coin on the blockchain was last transferred is its true value.<\/p>\n When this capitalization model is divided by the total number of coins in circulation, the \u201crealized price<\/a>\u201d is obtained, which is the average cost basis of the supply.<\/p>\n However, this method has some issues, such as a chunk of the circulating Bitcoin supply being permanently inaccessible (due to wallet keys becoming lost). A lot of this inactive supply would have traded long ago, meaning its cost basis would be shallow compared to today\u2019s prices. Thus, if included in the metric, it would skew its value away from reality.<\/p>\n Checkmate and Ark Invest\u2019s David Puell<\/a> came up with \u201cCointime Economics\u201d a while back, a new methodology that tackles the problems with the realized price.<\/p>\n \u201cCointime Economics introduces a simplified framework to efficiently discount the impact of lost supply and amplify economic impacts on the truly active supply,\u201d explains Glassnode.<\/p>\n The chart below shows the trend in the \u201ctrue market mean price\u201d for Bitcoin, as calculated by this advanced model.<\/p>\n\n Based on this more accurate model, Bitcoin currently has a true mean price of $29,700. Therefore, the asset\u2019s spot price is trading well below this level.<\/p>\n The graph shows that significant breaks above this indicator have historically resulted in the cryptocurrency enjoying some sustained bullish momentum.<\/p>\n Checkmate has also attached the \u201cAVIV Ratio Z-Score\u201d data in the same chart. The \u201cAVIV Ratio\u201d tracks the deviation from the true market mean that BTC is currently observing.<\/p>\n The Glassnode lead notes that this indicator is the most accurate measure of the market centroid for Bitcoin. At the current value, the metric is \u201cstill -0.6 standard deviations below its long-term mean,\u201d according to the analyst.<\/p>\n The near-term outcome of the price based on this is uncertain, but in the long term, Bitcoin could see a reversion back to its mean, thus making the current price levels potentially profitable buying points.<\/p>\n At the time of writing, Bitcoin is trading at around $27,500, down 3% in the last week.<\/p>","protected":false},"excerpt":{"rendered":" <\/p>\n On-chain data shows the true market mean price of Bitcoin is valued at $29,700 right now, making the level of particular significance for the coin.<\/p>\n In a new post<\/a> on X, the lead on-chain analyst at the on-chain analytics firm Glassnode, \u201cCheckmate,\u201d pointed out how the BTC price currently trades below the true market cost basis.<\/p>\n The \u201cmarket cost basis\u201d refers to the average price at which the investors in the sector bought their coins. One popular way of calculating this cost basis is through the \u201crealized cap<\/a>,\u201d which measures the total value of the cryptocurrency by assuming that the price at which each coin on the blockchain was last transferred is its true value.<\/p>\n When this capitalization model is divided by the total number of coins in circulation, the \u201crealized price<\/a>\u201d is obtained, which is the average cost basis of the supply.<\/p>\n However, this method has some issues, such as a chunk of the circulating Bitcoin supply being permanently inaccessible (due to wallet keys becoming lost). A lot of this inactive supply would have traded long ago, meaning its cost basis would be shallow compared to today\u2019s prices. Thus, if included in the metric, it would skew its value away from reality.<\/p>\nBTC Price<\/h2>\n
Bitcoin True Market Mean Price Is At $29,700 Currently<\/h2>\n