Bitcoin Breaks Above Realized Price Again, Bottom Finally In?
July 18 2022 - 3:00PM
NEWSBTC
Data shows Bitcoin has broken above the realized price once again
as the crypto surges to $22k. Will the recovery hold this time?
Bitcoin Makes 2nd Attempt To Break Above Realized Price In 10 Days
As pointed out by an analyst in a CryptoQuant post, BTC may be
finally shooting above the realized price again after spending 33
days below the level in total. To understand what the “realized
price” is, it’s best to first take a look at a quick explanation of
the two main capitalization methods for Bitcoin. The “market cap”
is calculated by multiplying each coin in circulation right now
with the current BTC price, and taking the total sum (or more
simply, it’s just the total number of coins multiplied by the
price). Where the “realized cap” differs is that, instead of taking
the same one price for all, it rather weighs each coin against the
value of BTC at which the particular coin was last moved/sold.
Related Reading | Bitcoin Bearish Signal: Exchange Netflows
Spike Up For example, suppose the current Bitcoin price is $22k and
there are two coins in circulation. If one of these last moved at
$22k while the other at $15k, then the market cap will be $44k, but
the realized cap will be $37k. Now, the realized price is measured
by just dividing the realized cap by the total number of coins in
circulation. The below chart shows the trend in this metric over
the past month: Looks like the BTC price is crossing over the
metric's line | Source: CryptoQuant As you can see in the above
graph, the value of Bitcoin very briefly spiked above the realized
price around ten days ago, before slamming down again,
Historically, late stage bear markets have lasted while the price
of the crypto has remained below the metric’s line, with it acting
as resistance. Related Reading | Bitcoin Funding Rate Turns
Highly Positive, Long Squeeze In The Making? Today, BTC has once
again shot up above the realized price curve, but it’s yet to be
seen whether this time the recovery will last. If it does, then it
could mean the bear bottom for the current cycle might be in.
Ignoring the brief spikes above the level, Bitcoin has now spent 33
days under the realized price so far. During 2015, the crypto was 9
months under this level, while in 2018 it was for a quarter of a
year. BTC Price At the time of writing, Bitcoin’s price floats
around $22k, up 8% in the last seven days. Over the past month, the
crypto has gained 8% in value. The price of the coin seems to have
surged up over the past day | Source: BTCUSD on TradingView
Featured image from Maxim Hopman on Unsplash.com, charts from
TradingView.com, CryptoQuant.com
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