This Happened Right on Cusp of 'Black Thursday.' Will Bitcoin Price Crash Again?

Opinions
Fri, 06/19/2020 - 16:07
Alex Dovbnya
Bitcoin's realized cap hits an all-time high. Here's why it's bad news for the bulls
Cover image via stock.adobe.com
Contents

According to data provided by on-chain analytics firm Glassnode, Bitcoin’s realized cap has just reached a new all-time high. 

image by studio.glassnode.com

At the time of writing, $106.6 billion has been invested in the Bitcoin over the course of its existence.   

Related
Bitcoin Active Supply Prints New High Over Past 24 Hours: Glassnode Data

Bitcoin’s realized cap, explained

Bitcoin’s market capitalization, which simply multiplies Bitcoin’s total supply by the asset’s current price, currently stands at $172 bln.

Instead of assigning the same value to every UTXO, analysts also calculate Bitcoin’s realized cap by recording the latest price at which each coin moved.

Analysts believe the realized cap metric proves a clearer picture of the network’s liquidity since it doesn’t treat all coins uniformly.

For example, it gives significantly less weight to dormant BTC that cannot be accessed due to lost private keys.

Related
Tether (USDT) Continues to See Growing Adoption on Ethereum Blockchain: Glassnode Data

Why this is good for the bears

Bitcoin’s realized market cap crossed the $100 bln milestone on Aug. 2019, which was followed by a sharp sell-off that caught traders off guard one month later. 

Glassnode points out that the last all-time happened right before ‘Black Thursday’ of May 12 when BTC careened more than 51 percent in 24 hours.

Cryptocurrency analyst Luke Martin says that realized cap at highs ‘hasn’t been good’ to Bitcoin’s price action in a new tweet.

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.

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