⚡️🚨 #BITCOIN is still far from its…

⚡️🚨 #BITCOIN is still far from its ATH.

During previous #ATHs, the MVRV Z-Score was much higher:

🔹 In 2013, it reached 8.91.
🔹 In 2017, it was 9.69.
🔹 In 2021, it stood at 6.94.
🔹 Today, it is currently at 2.61.

👉 What is the MVRV Z-Score used for?

The MVRV Z-Score was designed to identify periods when #Bitcoin is either extremely overvalued or undervalued relative to its "fair value."

👉 This indicator is based on two concepts:

🔹 Market Value: This is the current price of #Bitcoin multiplied by the total number of #Bitcoin in circulation. It is a standard measure representing the total price of #Bitcoin as perceived by the market at a given time.

🔹 Realized Value: Unlike market value, realized value takes into account the price at which each #bitcoin was last purchased. It is calculated by summing the purchase price of each #bitcoin at its last movement (or transfer) on the blockchain. This includes bitcoins that have not been moved for long periods, which may indicate lost or long-term-held #bitcoin.

The MVRV Z-Score is calculated by dividing the difference between market value and realized value by the standard deviation of market value.

👉 Interpreting the MVRV Z-Score:

🔹 High Z-Score (usually above 3.7): A high MVRV Z-Score indicates that the market value is significantly higher than the realized value, suggesting that #Bitcoin is overvalued.

🔹 Low Z-Score (usually below 1): A low MVRV Z-Score suggests that #Bitcoin is undervalued relative to its historical fair value. This occurs when the price of #Bitcoin is lower than the average price at which #bitcoin were last purchased.

Currently, the MVRV Z-Score is 2.61, suggesting that #Bitcoin is far from being overvalued.