28.10.2021

Bitcoin’s realized price has reached an all-time high. What does it mean?

According to Glassnode analysts, the realized value of Bitcoin exceeded the $ 10,000 mark for the first time in the history of cryptocurrency. Recall that this indicator reflects the average price of bitcoins during their last movement.

We’ve previously written about how the realized price of BTC crossed the $ 6,000 threshold in August last year. Accordingly, it took her several months of steady growth for a new serious record.

We checked the actual data: today, Bitcoin crossed the mark of 41 thousand dollars, which is 10.3 percent higher than the result of a day ago. At the same time, over the last day, the BTC rate also managed to cross the $ 40,000 line three times. Between these events, the cryptocurrency managed to adjust to the 37 thousand line, that is, the drawdown was quite noticeable.

For clarity, we present a graph of the BTC rate for the last week. On the first day of January, Bitcoin was valued at $ 29,000.

Important indicators of Bitcoin

The importance of the record was explained by Glassnode CTO Rafael Schulze-Kraft. Here is his line, in which he shares his reaction to what is happening. The statement is quoted by Decrypt.

BTC realized price is the average price at which each bitcoin was last moved on the network. This is the average value that investors have assigned to BTC according to their last movement on the network.

That is, if a user stores a bitcoin that he purchased in January 2017 for a thousand dollars, the realized value of this BTC is just 1000 dollars. This explains the significant difference between the current cryptocurrency exchange rate and the realized price indicator. Yet many users have kept coins for many years. For example, as we learned last November, an anonymous person transferred bitcoins that have not been touched since 2010. Then they cost hundreds of times cheaper.

In other words, while Bitcoin’s market capitalization is the total amount of BTC multiplied by the current market value of the coin, its realized capitalization takes into account the value of each BTC at the price of its last move on the blockchain. Thus, the realized price of Bitcoin is equal to the realized capitalization divided by the current supply.

According to the analytical platform Coin Metrics, Bitcoin’s current realized capitalization is approximately $ 189.2 billion. If we divide this figure by 18,593,500 – that is, the total amount of BTC mined to date – we get the result in the $ 10,175 zone.

Bitcoin’s realized price is important because it represents a way to understand the rise in cryptocurrency adoption while mitigating the effect of large leaps in value. As you can see in the chart above, Bitcoin’s realized capitalization increased in 2017, but did not reach extreme values, as on a regular price chart. Meanwhile, the total market capitalization of the entire crypto market recently surpassed the trillion dollar mark.

In addition, the hashrate of the Bitcoin network continues to set new highs right now. This means that interest in cryptocurrency mining is at an unprecedented level.

We believe that the rise in Bitcoin’s realized value is very important. He proves that cryptocurrency is in demand among investors, and the niche is being replenished with new people who want to invest money. At the same time, he reminds that many coin holders bought them much earlier and do not plan to part with the asset yet. Obviously, their plans for BTC growth are not limited to the $ 40K mark.

Further, the indicator will increase. Still, the gap between it and the usual price is quite large, and more and more participants appear in the cryptocurrency industry who will purchase BTC and transfer them.

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