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On June 13, cryptocurrency costs plunged deeper into bear market territory after Bitcoin (BTC) sliced by means of its present buying and selling vary and briefly touched $22,600, its lowest stage se since December 2020.
In response to BTC historic knowledge, the market has now reached valuation metrics that present the worth is severely oversold and maybe close to a backside. Bitcoin has now fallen beneath its realized value, which represents the typical value of each coin in provide based mostly on the time it was final spent on-chain.
Whereas the ache that this most up-to-date capitulation has wrought throughout the ecosystem can’t be understated, the one glimmer of hope it provides weary crypto merchants is that the worst of the decline might have occurred. The approaching days will verify this idea and proof could be establishments and retail merchants stepping in to purchase the dip.
“Shrimps and whales” accumulate
On-chain knowledge reveals that not all merchants really feel devastated about Bitcoin at yearly lows. Shrimp wallets, wallets that maintain lower than 1 BTC, and whale wallets with greater than 10,000 BTC have been in accumulation mode for the reason that outdated Terra (LUNA), now often called Luna Basic (LUNC), collapsed in early Might.
Whale wallets have likewise been busy during this period of time as “this cohort has a monthly position change peak of ~140k BTC/month” and has added a total of +306,358 BTC since its all-time high in November.
Related: Bitcoin analysts are watching these BTC price levels as key trendline looms
Support is limited in the mid-$20,000 range
Part of the reason for the rapid sell-off on June 13 was the lack of demand in the $20,000 to $27,000 range as shown on the following entity-adjusted unspent realized price distribution chart.
While there is a heavy amount of demand near the $30,000 and $40,000 price ranges, some of the lowest volumes were found between $20,000 and $27,000, which left little support as the price of BTC crashed in the early hours on June 13.
Relief may be in sight, however, as the saying goes “it’s always darkest before the dawn” and this could apply to the current state of the crypto market based on several metrics.
According to the RVT ratio, which compares the realized capitalization against the daily volume settled on-chain, “the network valuation is now 80 times larger than the daily value settled,” which indicates a low amount of on-chain activity.
Glassnode said,
“In past bear cycles, an underutilized network has provided confluence with bear market bottoms.”
The RVT ratio is currently at its highest level since 2010, which may suggest that the market has reached the point of max pain and could see improvements soon, but the possibility of further weakness can not be ruled out.
The overall cryptocurrency market cap now stands at $980 billion and Bitcoin’s dominance rate is 46.3%.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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