▲ Bitcoin (BTC)

As a powerful undervaluation signal similar to the level seen during the collapse of FTX—once the worst bankruptcy event in crypto exchange history—has been triggered, analysis suggests that Bitcoin (BTC), the market leader, may be preparing for an explosive rebound after breaking out of its prolonged sideways range, drawing significant market attention.

According to cryptocurrency media outlet Bitcoinist on March 14 (local time), CryptoQuant analyst Xwin Research Japan reported that Bitcoin’s 365-day Market Value to Realized Value (MVRV) ratio has fallen to levels similar to those seen at the end of 2022. The MVRV ratio compares market capitalization with realized capitalization, which is based on the price at which coins last moved on-chain, and is used to determine whether the average investor is currently holding unrealized profits or losses.

Historical data shows that when this indicator has fallen significantly below its long-term average and remained suppressed, it has often been followed by strong recoveries in Bitcoin’s price. In fact, after the severe market stress at the end of 2022, Bitcoin entered a similar undervalued zone and subsequently surged 67% over the next three months, signaling the start of a broad bullish market. Such low readings indicate that many investors are at a loss, suggesting that additional selling pressure from weaker hands has largely been exhausted.

However, the current market environment differs markedly from that of 2022, which was driven primarily by internal liquidity crises. Today’s crypto market is dominated by macroeconomic factors such as high interest rates and tight global liquidity. Nevertheless, the structural fundamentals of the market have strengthened significantly compared to the past, supported by the introduction of spot Bitcoin ETFs and continued accumulation strategies by corporations, which have substantially increased institutional participation.

Bitcoin is currently trading around the $72,000 level, having stabilized and formed a short-term recovery structure after plunging to as low as $60,000 intraday in February. The leading cryptocurrency, which previously surpassed $120,000 in the last cycle, faced months of selling pressure afterward but has recently reclaimed the $70,000 zone and is persistently attempting to break through the $72,000 resistance level.

From a technical perspective, Bitcoin still remains below key downward-sloping moving averages, making it premature to confirm a full trend reversal. Experts note that the $72,000 to $74,000 range represents a critical resistance zone that will determine the next direction. A successful breakout could open the door to a broader rally toward higher price levels, while failure to overcome this barrier may result in continued sideways movement.

*Disclaimer: This article is for investment reference only and we are not responsible for any investment losses incurred based on it. The content should be interpreted for informational purposes only.*

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