Popular cryptocurrency analytics firm Glassnode has identified an on-chain metric for Bitcoin that suggests the potential onset of a bull market. This indicator, known as the long-term holder MVRV (LTH-MVRV), assesses the actions of long-term Bitcoin investors and has reached what is considered a high-risk level—a trend often seen at the beginning of bull markets.
Key Bitcoin Indicator Surges
The firm’s chart reveals that Bitcoin’s LTH-MVRV signal is currently above the threshold that typically precedes market growth. Glassnode illustrates this point by stating that the indicator, which has recently hit 2.06, is now within the high-risk zone. This trend is commonly observed when long-term investors begin to realize substantial profits.
Glassnode’s Take on Profit Supply Ratio
Another metric Glassnode is examining is the Profit Supply Percentage (PSIP), which gauges the proportion of cryptocurrencies whose acquisition cost is below the current trading price. Their insight suggests Bitcoin may be approaching the enthusiastic phase of a bull market, a stage defined by heightened market optimism. Glassnode recalls a previous instance when this metric spiked prior to a market rally, which was then followed by a decline to $38,000.
In sum, Glassnode’s analysis indicates that Bitcoin is showing signs of entering a bull market, with the LTH-MVRV metric signaling a possible market expansion. Concurrently, the PSIP metric supports the notion that Bitcoin could soon reach the euphoric stage that characterizes the peak of market cycles.