Specialists from the cryptocurrency analytical company Glassnode reported that the Bitcoin market was in a high-risk zone. The MVRV indicator, which reflects the ratio of market capitalization to realized capitalization of Bitcoin, reached its maximum level since June 2022 at 2.06. Historical data suggests that an increase in MVRV to this level during an upward movement means the imminent start of a powerful bullish trend.
The MVRV indicator has increased and entered the risk zone due to the increase in the price of Bitcoin. The indicator value of 2.06 means that cryptocurrency holders who bought coins, for example, a year ago, will earn 106% profit by selling BTC at the current price. Accordingly, the higher MVRV rises, the more profit long-term investors can receive, and the more likely they are to get rid of assets. Many analysts explain the increase in the BTC price by the high demand for Bitcoin ETFs, in which $10 billion have already been invested. Moreover, on February 9, capital outflow from the Grauscale Bitcoin Trust (GBTC) fund fell to a minimum value of $51.8 million. In January, nine days after the conversion of GBTC into a Bitcoin ETF, the level of capitalization of the derivative tiva decreased by $4.4 billion.
