Key Takeaways:
- CryptoQuant CEO Ki Young Ju signals end of Bitcoin bull cycle
- Growing divergence between realized cap and market cap indicates bearish trend
- Analysis aligns with recent market pullback below $80,000
In a significant market development, CryptoQuant CEO Ki Young Ju has declared the conclusion of Bitcoin’s recent bull cycle, citing concerning metrics in the relationship between realized cap and market cap. This analysis comes as Bitcoin recently crashed below $80,000, erasing $160 billion in market value during a dramatic weekend selloff.
The realized cap, a crucial on-chain metric that tracks the average cost basis of Bitcoin holdings, has shown an increasing divergence from the current market cap, traditionally a reliable indicator of market sentiment shifts. This technical signal has historically preceded major market corrections.
Understanding Realized Cap vs. Market Cap
Realized cap provides a more nuanced view of Bitcoin’s value by calculating the price of each BTC when it was last moved, rather than the current market price. When this metric significantly diverges from the market cap, it often signals unsustainable price levels.
Market Implications and Expert Analysis
Ki Young Ju’s analysis gains additional credibility when viewed alongside other recent market indicators. The divergence pattern he identifies mirrors similar situations from previous market cycles, particularly during the 2021 correction.
Frequently Asked Questions
- What is realized cap in cryptocurrency?
Realized cap calculates Bitcoin’s value based on the price of each coin when it last moved, providing insight into investor cost basis. - How reliable is the realized cap indicator?
Historically, realized cap divergence has predicted major market turns with approximately 70% accuracy. - What should investors do during a bear phase?
Consider implementing risk management strategies and maintaining a diversified portfolio while watching key support levels.
As the crypto market enters this potentially bearish phase, investors should closely monitor these metrics while maintaining a balanced approach to risk management.