Bitcoin
Is The Bitcoin Cycle Top In? What 13 On-Chain Indicators Say
In the latest edition of Capriole Investments’ “Bitcoin Update,” Charles Edwards, founder and CEO, examines the current state of Bitcoin through a detailed analysis of thirteen on-chain indicators to address the critical question: Is the Bitcoin cycle top in?
A month after a promising technical breakout above $65.5K, which briefly touched $70K, Bitcoin experienced a sharp reversal, suggesting a possible cycle top. Edwards notes, “Never before has Bitcoin broken a new all-time high and had two retests instead of printing new highs.” This pattern, according to him, indicates a potential size-related consolidation but is generally a sign of market weakness.
Bitcoin On-Chain Data Analysis
#1 Supply Delta + 90 Day CDD: These metrics provide a strong indication of cycle tops by displaying supply movements and coin destruction days. The recent data formed a rounded top after a vertical increase in both metrics, which historically corresponds with market peaks. Edwards rates this as bearish, implying that the supply dynamics are signaling a downturn.
#2 Long-term Holder Inflation Rate: Historically, a threshold of 2.0 in this metric has been a reliable predictor of cycle tops. The rate has escalated from 0.5 in April to 1.9, now teetering close to this critical level. This proximity suggests that long-term holders are becoming increasingly likely to sell, marking another bearish indicator.
#3 Hodler Growth Rate (HGR): This measures the net growth of long-term holders. A decline or plateau in this rate often precedes market tops, as it indicates long-term investors cashing out. Currently, the HGR has not made new highs in over six months, aligning with historical precedents of cycle tops and thus is scored bearish.
#4 Bitcoin Heater: Analyzing extreme readings in funding, basis, and options, this metric stands neutral in the current cycle, indicating no significant market exuberance that typically precedes market tops. Furthermore, the absence of new leverage in the market contributes to this neutral stance.
#5 Dynamic Range NVT: This valuation metric compares on-chain transaction volume to market cap, recently moving out of the value zone due to increased on-chain activity from innovations like Ordinals and Runes. Despite this increase, it remains neutral, suggesting a balanced market valuation.
#6 On-chain Transaction Fees: Elevated transaction fees typically indicate high network demand, which can point to cycle peaks when followed by a sharp decline. Current fees have shown some spikes but largely mirror the decline noted in April. This metric remains neutral but is something Edwards advises to watch closely.
#7 Net Unrealized Profit/Loss (NUPL): Positioned just below the euphoria zone at 74%, the NUPL suggests that most market participants are in profit, but not excessively so. This delicate balance leaves the metric in a neutral state, reflecting potential caution but not outright exuberance.
#8 Spent Volume 7-10 years: A significant increase in spent volume from older coins typically suggests selling by long-term holders or “whales,” which can precede a market top. The massive transaction on May 28, involving 138,000 Bitcoin, primarily from Mt. Gox distributions, marks this as bearish, indicating potential market pressure from large-scale sell-offs.
#9 SLRV Ribbons: This metric, which looks at short and long revert ribbons, shows a bearish crossover for the first time this year. While it hasn’t reached an elevated point suggesting a cycle top, the recent trend is concerning and contributes to the bearish outlook.
#10 Dormancy Flow: With dormancy flow peaking significantly this year, the average age of spent coins is higher, similar to peaks seen in 2017 and 2021. This continuation of a high dormancy flow rate is bearish, suggesting a potential cycle top is near.
#11 Percent Addresses in Profit: Over 95% of addresses being in profit usually precedes a cycle top. With the recent high and subsequent decline, this indicator turns bearish, signaling that many investors might be taking profits, which could lead to a price drop.
#12 Mayer Multiple: Despite a peak at 1.9 in March, the Mayer Multiple remains below the 2.5 threshold that has historically indicated major cycle tops. Currently at 1.0, this metric is neutral, indicating that while the market is heated, it hasn’t reached the extremes of previous cycle peaks.
#13 US Liquidity: The correlation between liquidity and Bitcoin’s price is strong, and recent trends show a persistent downtrend in liquidity, which Edwards finds concerning. This negative liquidity growth aligns with a bearish outlook for Bitcoin.
What Does This Mean For The Bitcoin Cycle?
Out of thirteen metrics analyzed, eight are currently bearish, five remain neutral, and none are bullish. This predominance of bearish indicators suggests that the cycle top could very well be in, marking a potential pivot point for Bitcoin. “I won’t lie, I find this on-chain data hard to believe. I am surprised by the count of Bearish signals for being just two months post halving,” Edwards noted.
Despite the bearish lean in on-chain metrics, he highlights the importance of considering technical patterns and broader market behavior. Bitcoin’s price is currently above the $58K support level, and the potential formation of a Wyckoff Accumulation pattern on the daily chart suggests that the market could still hold bullish potential.
However, the mixed signals necessitate cautious optimism and vigilant risk management. “Fundamentals look bearish, but technicals are still bullishly skewed. That leaves ambiguity here. All of the bearish Top Signals could be the result of typical summer months inactivity. Or perhaps this cycle will be a bit more like 2013 with a double top, or some hybrid mid-cycle grind that we must go through now given we are playing in the big league with the TradFi today,” Edwards remarked.
However, he also concluded, “My gut tells me this is just an exceptionally bad summer period for Bitcoin on-chain activity, and we will see what is usually the best 12 month window for Bitcoin risk-adjusted returns post-Halving resume in Q4 and beyond.”
At press time, BTC traded at $62,747.
Featured image created with DALL·E, chart from TradingView.com
Michael Saylor announced that Strategy purchased nearly $2 billion worth of Bitcoin. This is a massive leap over last week’s purchase, which was already quite substantial.
Nonetheless, the firm was only able to make this acquisition thanks to major stock offerings. Bitcoin’s price has been sinking over the last few weeks, and this could mature into a potential liquidation crisis.
Strategy Maintains Bitcoin Purchases
Since Strategy (formerly MicroStrategy) began acquiring Bitcoin, it’s become one of the world’s largest BTC holders. This plan has totally reoriented the company around its massive acquisitions, inspiring other firms to take up the same plan.
Today, the firm’s Chair, Michael Saylor, announced another purchase, much larger than the last few.
“Strategy has acquired 22,048 BTC for ~$1.92 billion at ~$86,969 per bitcoin and has achieved BTC Yield of 11.0% YTD 2025. As of 3/30/2025, Strategy holds 528,185 BTC acquired for ~$35.63 billion at ~$67,458 per bitcoin,” Saylor claimed via social media.
Strategy’s latest Bitcoin acquisition, worth just shy of $2 billion, is a major commitment. In February, the firm made a similar $2 billion purchase, and it was followed by a tiny $10 million buy and a $500 million one. The $500 million purchase, which took place on March 24, only happened thanks to a huge new stock offering. This move further cements Strategy’s faith in BTC.
By making these billion-dollar buys, Strategy is able to buttress the entire market’s confidence in Bitcoin. However, investors should be aware of a few potential cracks.
First of all, Bitcoin’s performance is a little subpar at the moment. Despite hitting an all-time high recently, Bitcoin is having its worst quarter since 2019, and there is not much forward momentum.
This could cause a unique problem for the company. Since Strategy is a cornerstone of market confidence, it is unable to offload its assets without jeopardizing Bitcoin’s price.
The firm’s debts are growing at a fast rate, and this could have dangerous implications if Bitcoin keeps falling. Strategy could be forced to liquidate, even if that seems unlikely now.
Still, it’s important to remember that these are only possible scenarios. Strategy has maintained its consistent Bitcoin investments for nearly five years, and it’s paid off tremendously well. However, if it keeps taking on billions in fresh debt obligations, this faith will turn into a gamble with very high stakes.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Bitcoin (BTC) is on track to end Q1 with its worst performance since 2019. Without an unexpected recovery, BTC could close the quarter with a 25% decline from its all-time high (ATH).
Some analysts have noted that experienced Bitcoin holders are shifting into an accumulation phase, signaling potential price growth in the medium term.
Signs That Veteran Investors Are Accumulating Again
According to AxelAdlerJr, March 2025 marks a transition period where veteran investors move from selling to holding and accumulating. This shift is reflected in the Value Days Destroyed (VDD) metric, which remains low.
VDD is an on-chain indicator that tracks investor behavior by measuring the number of days Bitcoin remains unmoved before being transacted.
A high VDD suggests that older Bitcoin is being moved, which may indicate selling pressure from whales or long-term holders. A low VDD suggests that most transactions involve short-term holders, who have a smaller impact on the market.
Historically, low VDD periods often precede strong price rallies. These phases suggest that investors are accumulating Bitcoin with expectations of future price increases. AxelAdlerJr concludes that this shift signals Bitcoin’s potential for medium-term growth.
“The transition of experienced players into a holding (accumulation) phase signals the potential for further BTC growth in the medium term,” AxelAdlerJr predicted.
Bitcoin’s Sell-Side Risk Ratio Hits Low
At the same time, analyst Ali highlighted another bullish indicator: Bitcoin’s sell-side risk ratio had dropped to 0.086%.
According to Ali, over the past two years, every time this ratio fell below 0.1%, Bitcoin experienced a strong price rebound. For example, in January 2024, Bitcoin surged to a then-all-time high of $73,800 after the sell-side risk ratio dipped below 0.1%.
Similarly, in September 2024, Bitcoin hit a new peak after this metric reached a low level.
The combination of veteran investors accumulating Bitcoin and a sharp decline in the sell-side risk ratio are positive signals for the market. However, a recent analysis from BeInCrypto warns of concerning technical patterns, with a death cross beginning to form.
Additionally, investors remain cautious about potential market volatility in early April. The uncertainty stems from President Trump’s upcoming announcement regarding a major retaliatory tariff.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
Marathon Digital Holdings, one of the largest Bitcoin mining companies in the US, made headlines with its announcement of a $2 billion stock offering to increase its Bitcoin holdings.
This strategic move, detailed in recent SEC filings, shows Marathon’s aggressive approach to capitalize on the growing crypto market.
Marathon’s $2 Billion Stock Offering: Key Details
On March 30, 2025, Marathon Digital Holdings announced a $2 billion at-the-market (ATM) stock offering to fund its strategy of acquiring more Bitcoin. The company filed a Form 8-K with the SEC, outlining its plan to raise capital through the sale of shares, with the proceeds primarily aimed at increasing its Bitcoin holdings.
According to the SEC filing (Form 424B5), Marathon intends to use the funds for “general corporate purposes,” which include purchasing additional Bitcoin and supporting operational needs.
Marathon holds 46,376 BTC, making it the second-largest publicly traded company in Bitcoin ownership, behind MicroStrategy. The company’s Bitcoin holdings have grown significantly in recent years, from 13,726 BTC in early 2024 to the current figure.
“We believe we are the second largest holder of bitcoin among publicly traded companies. From time to time, we enter into forward or option contracts and/or lend bitcoin to increase yield on our Bitcoin holdings.” Marathon confirmed
This $2 billion stock offering continues Marathon’s strategy to bolster its balance sheet with Bitcoin, a move that aligns with its long-term vision of leveraging cryptocurrency as a store of value.
Marathon’s strategy mirrors that of MicroStrategy. MicroStrategy’s stock price has soared with Bitcoin’s value, providing a blueprint for companies like Marathon to follow. By increasing its Bitcoin holdings, Marathon aims to position itself as a leader in the crypto mining sector while diversifying its revenue streams beyond traditional mining operations.
Marathon Digital CEO Fred Thiel advises investing small amounts in Bitcoin monthly, citing its consistent long-term growth potential.
The issuance of new shares to raise $2 billion could dilute the ownership of existing shareholders, potentially impacting the company’s stock price (MARA). As of March 31, 2025, MARA stock has experienced volatility, trading at around $12.47 per share, down from a 52-week high of $24, according to data from Yahoo Finance.
Moreover, Marathon’s heavy reliance on Bitcoin exposes it to the cryptocurrency’s price fluctuations. If Bitcoin’s price were to decline significantly, the value of Marathon’s holdings would decrease, potentially straining its financial position.
Disclaimer
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
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