Bitcoin below the Realized Price: “Historically, a good buying moment”

Last Updated: 30 August 2022

The bitcoin price started a fresh decline last weekend, and is now trading below the Realized Price again at $20,266. Historically this has been a good buying opportunity, but remember that past performance is no guarantee of future results.

What is the Realized Price?

The Realized Price is simply the average price at which all bitcoin last changed addresses on the blockchain. This price has often been a good indicator of bottoms during bear markets throughout bitcoin’s history. We are now indisputably in a bear market as we have lost over 70 percent from the all-time high, and the bitcoin price continues to wobble.

Both during the bear market of 2014 to 2015 and during the bear market of 2018 to 2019, we found the bottom in the relatively short period that bitcoin was trading below the Realized Price. In this regard, it may be interesting to buy small amounts at current prices, provided you are convinced of bitcoin’s long-term value.

Of course, it is also important to remember that the Realized Price is not the only way to analyse the bitcoin price. Bitcoin has become so big that the whole world is talking about bitcoin. This means that the macroeconomic environment is increasingly playing an essential role in bitcoin’s performance.

At the moment, the macroeconomic environment is anything but favourable, which means that it remains to be seen whether we will find the bottom in the short term or have already found it during the correction in June 2022. For now, the bottom is at $17,600, but with the current price of $20,266, we are slowly getting close to it again.

Mayer Multiple creeping down

The Mayer Multiple has also proven over the years to be a powerful indicator for predicting bitcoin tops and bottoms based on more long-term data. This indicator simply takes the bitcoin price and divides it by the 200-day moving average. The higher the score, the bigger the bubble and vice versa.

Currently, the Mayer Multiple writes a score of 0.63 and is therefore, extremely low. Throughout bitcoin’s history, the Mayer Multiple has been lower than today on only 268 days. The 200-day moving average is at 31,520, while the price is just above $20,000.

However, there is no guarantee that the Mayer Multiple cannot fall even lower than the current score of 0.63 during this bear market. Therefore, use this type of tool mainly as part of your strategy and do not base your entire strategy on these indicators.

  • Ivan Brightly

    Ivan Brightly is a leading cryptocurrency analyst and author with over 5 years of experience in the blockchain and digital asset space. He previously served as a senior analyst at a major cryptocurrency hedge fund where he led quantitative research and trading strategy development.

    Ivan holds a Master's degree in Finance from the London School of Economics and a Bachelor's in Computer Science from Stanford University. He is frequently invited to speak at fintech and blockchain conferences worldwide on topics spanning cryptocurrency trading, blockchain technology, and the future of digital assets.

    Ivan's commentary has been featured in several major finance and technology publications including Forbes, Bloomberg, and CoinDesk. He is considered one of the most insightful voices analyzing new developments in the cryptocurrency and blockchain industry.

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