Original Title: 2025 Bitcoin Outlook: Data-Driven Insights
Original Author: Bitcoin Magazine Pro
Original Translation: Plain Language Blockchain
As we step into 2025, it's time to rationally and analytically examine the situation Bitcoin may face this year. By combining on-chain data, market cycles, macroeconomic data, and other factors, we can move beyond mere speculation to paint a data-driven picture for the coming months.
1. MVRV Z-Score: Huge upside potential
The MVRV Z-Score measures the ratio between Bitcoin's realized price (the average purchase price of all Bitcoins in the network) and its market capitalization. By normalizing the volatility of this ratio, we arrive at the Z-Score, a metric that has historically provided a clear view of market cycle trends.
Figure 1: The MVRV Z-Score shows we still have a long way to go before the market cycle peak
Currently, the MVRV Z-Score indicates that we still have significant upside potential. Although the Z-Score has exceeded 7 in past cycles, I believe that any value above 6 indicates market overextension and requires closer observation of market peaks alongside other indicators. Currently, our level is comparable to May 2017—when Bitcoin's price was only a few thousand dollars. Considering the historical context, there is still several hundred percentage points of potential upside from the current level.
2. PiCycle Oscillator: Bullish momentum recovers
Another key indicator is the PiCycle top and bottom indicator, which tracks the 111-day and 350-day moving averages (the latter multiplied by 2). Historical data shows that when these two moving averages cross, it usually signals that Bitcoin's price will peak within a few days.
Figure 2: The macro trend remains bullish
The distance between these two moving averages has begun to rise again, indicating that bullish momentum is recovering. Although 2024 experienced several periods of range consolidation, the current breakout suggests that Bitcoin is entering a stronger growth phase that could last for several months.
3. The exponential growth phase of the cycle
Based on Bitcoin's historical price movements, cycles typically last 6 to 12 months during the 'post-halving cooling' phase before entering an exponential growth phase. According to past cycle data, we are approaching this breakout point. While returns may be lower compared to earlier cycles, we could still see significant increases.
Figure 3: Compared to previous bull market cycles, we are approaching the most bullish phase of the cycle
As background information, after breaking the previous historical high of $20,000 during the 2020 cycle, Bitcoin's price peaked at nearly $70,000, an increase of 3.5 times. If we see a conservative estimate of doubling or tripling from the previous peak of $70,000, Bitcoin could realistically reach $140,000 to $210,000 in this cycle.
4. Macro factors supporting Bitcoin's performance in 2025
Despite facing some resistance in 2024, Bitcoin remains strong, even in the context of a rising dollar index (DXY). Historically, Bitcoin's trend has typically been inversely correlated with DXY, so if DXY strongly reverses, it could further boost Bitcoin's upside potential.
Figure 4: Bitcoin continues to rise even as the dollar index surges
Other macroeconomic indicators, such as high-yield credit cycles and global M2 money supply, indicate that Bitcoin's market environment is improving. The monetary supply contraction seen in 2024 is expected to reverse in 2025, laying the groundwork for a more favorable market environment.
5. Cycle Main Chart: There is still a long way to go
The Bitcoin cycle main chart aggregates multiple on-chain valuation indicators, showing that Bitcoin still has considerable growth potential before reaching overvaluation. The current upper limit is around $190,000, and this upper limit continues to rise, further reinforcing the outlook for sustained upward momentum.
Figure 5: The 'overvaluation' level of the cycle main chart has exceeded $190,000
6. Conclusion
Currently, almost all data indicators point to a bullish 2025. As always, past performance is not indicative of future results, but the data strongly suggests that Bitcoin's best times may still be ahead, even in the context of an already very positive performance in 2024.
