Assure DeFi CEO and crypto analyst Chapo predicts Market-Value-to-Realized-Value will peak around 3.2 this cycle, signaling the market top.

Bitcoin’s Market-Value-to-Realized-Value (MVRV), an indicator that measures whether the asset is overvalued or not, shows that the cryptocurrency still has room to peak this cycle, according to a crypto analyst.

“I predict a peak MVRV this cycle around 3.2, meaning we have another bullish year in 2025 ahead before we reach the pico top this cycle,” Assure DeFi CEO and crypto analyst Chapo said in a Feb. 26 X post.

The last time Bitcoin’s MVRV reached this level was in April 2021, when Bitcoin tapped $58,253 — representing approximately a 101% gain from its $28,994 price at the start of 2021.

The MVRV will “spike vertically” at market top

“We aren’t there yet,” Chapo said. The MVRV signals whether Bitcoin  is overvalued or undervalued based on the ratio between its market capitalization and realized capitalization.

At the time of publication, Bitcoin’s MVRV is 1.95, as per Bitbo data, while Bitcoin is trading at $84,416, as per CoinMarketCap data.

Bitcoin dropped below $90,000 on Feb. 25, a day after US President Donald Trump announced his planned 25% tariffs on Canada and Mexico “are going forward on time, on schedule.”

Chapo said that historically, the MVRV spikes significantly when Bitcoin’s price approaches its cycle peak.

“If history tells us anything, it’s that MVRV will spike vertically during a market top and reach a point at which profit-taking exceeds new buying interest, and the risk/reward for new entrants is no longer there,” he said.

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An increasing MVRV signals a potential rise in Bitcoin profit-takers

When Bitcoin hit its all-time high of $109,000 on Jan. 20, just before Trump’s inauguration as US President, the MVRV spiked to 2.44.

Similarly, when Bitcoin reached its previous all-time high of $73,679 in March, the MVRV was 2.67.

As the MVRV rises, it suggests that more Bitcoin holders are in profit and are likely to cash in some of their gains. Chapo said when profit-takers sell to new buyers, the cost basis decreases, leading to a decline in the MVRV.

For example, when Bitcoin fell to $53,949 on Sept. 7, 2024, the MVRV fell to 1.71.

“This is healthy, as new buyers aren’t expected to sell until they too are in profit, which requires a higher price,” Chapo said.

However, CryptoQuant head of research Julio Moreno said that the MVRV indicator indicates Bitcoin could experience further downside before it resumes its upward trend.

“All valuation metrics are in correction territory. It can take more time. For example, MVRV is below its 365-day moving average. This is a simple, yet powerful, indicator,” Moreno said in a Feb. 26 X post.