Here is the historical trend of Bitcoin's Market Value to Realized Value (MVRV) ratio that shows whether the current bull run is over.

Bitcoin's MVRV Ratio Could Hint at Where BTC Is in the Current Cycle

In a new post on X, CryptoQuant founder and CEO Ki Young Ju shared a chart showing the previous pattern in Bitcoin's MVRV Ratio. The MVRV Ratio refers to a popular on-chain metric that, in short, tracks the value that BTC investors hold (i.e. market cap) compared to the value they initially put into the asset (realized capitalization).

When the ratio value is greater than 1, it means that investors in general can be considered to be in a profitable state. On the other hand, when it is below this level, it implies a dominance of losses in the market.

The MVRV Ratio version posted by Young Ju is not the standard version, but a modified version called 'True MVRV'. This version only considers the data of coins participating in certain trading activities over the past seven years.

Coins older than seven years may be considered permanently lost, due to being forgotten or due to lost wallet keys. Therefore, True MVRV, excluding coins that are unlikely to return to circulation, can provide a more accurate picture of the space compared to the standard version of the metric.

Below is a chart showing the trend of this Bitcoin indicator in the history of this cryptocurrency:

As shown in the chart above, Bitcoin True MVRV has risen to a relatively high level during this bullish phase. This implies that the average investor is realizing significant profits.

Historically, the higher the profits of holders, the greater their likelihood of participating in a mass sell-off with the motivation to take profits. Therefore, whenever the MVRV Ratio rises high, the likelihood of a peak for BTC is very high.

From the chart, it can be seen that peaks in previous cycles occurred when the indicator crossed a specific line. So far, this metric has not come close to testing this level in the latest era.

According to the founder of CryptoQuant, the reason the market capitalization has not surged excessively compared to the actual capitalization is that there is still $7 billion flowing into the Bitcoin market each week.

If the current cycle shows anything similar to previous cycles, then a high but not excessively high actual MVRV could indicate that there is still room for BTC in the current bullish phase.