Key Points
- Chris Burniske, ex-Ark Invest crypto executive, believes that Bitcoin’s market cycle has not yet peaked.
- The Short-Term Holder (STH) MVRV indicates that the Bitcoin market may be exiting a local overheated phase.
Chris Burniske, a former crypto executive at Ark Invest and current VC partner at Placeholder, disagrees with market commentators who believe that the BTC cycle has reached its top. He argues that the market is currently in a “mid-bull pullback” and has not yet peaked.
Burniske compares the current market situation to the period from April to June 2021 when the value of coins fell by 50-80%. Despite the drop, the market rallied in the second half of 2021. He suggests that a similar scenario could play out this time around.
Bitcoin – The Significance of $96k
The Short-Term Holder (STH) MVRV, a key valuation indicator, supports Burniske’s projections. According to CryptoQuant’s Axel Adler, the STH MVRV’s drop from 1.35 to neutral levels suggests that the market may be exiting a local overheated phase.
Adler explains that an STH MVRV above 1.30–1.35 typically signals an overheated market, often leading to sell-offs. The recent decline in the indicator suggests that some STHs have exited their positions, signalling the end of a local overheated phase.
The STH realized price (RP) or average price cost of Bitcoin acquired over the past 1-3 months stands at $96K. This price has historically acted as either support or resistance.
If the price drops below this point, it could trigger panic among the STH cohort and lead to sell-offs. However, if the price rebounds on the STH RP as a support, it could sustain the uptrend.
Adler also notes that Bitcoin network activity has declined to yearly lows, which could suggest that BTC is overvalued. If the price is repriced, BTC could either hold at $96k or drop lower, but still provide new buying opportunities if the retracement extends to range lows.