Founder and CEO of Capriole Investments, Charles Edwards, introduces the Bitcoin Momentum era, backed by ten on-chain metrics signaling a significant shift in valuation and market dynamics.
Discussing recent developments on X (formerly Twitter), Charles Edwards, the CEO of Capriole Investments, has proclaimed the conclusion of the 'deep value era' for Bitcoin, marking the commencement of the 'Bitcoin Momentum era.' Edwards has conducted an in-depth analysis utilizing ten on-chain metrics of his creation, collectively signaling a substantial shift in the cryptocurrency's valuation and market dynamics.
Decoding Bitcoin On-Chain Insights
One pivotal metric, Bitcoin's Energy Value, now positions BTC's value at $70,000. Edwards elucidates, 'Bitcoin's intrinsic value, calculated solely from the energy input into the network, currently stands at $70K, establishing fair valuation for the first time in two years.'
The SLRV Ribbons, another metric introduced by Edwards, monitors the ratio of short-term to long-term holders, with current trends pointing towards promising high-return periods in BTC investments. Edwards notes, 'SLRV Ribbon uptrends typically identify the most lucrative Bitcoin risk-on periods, and the trend remains robust today.'
Dynamic Range NVT Signal introduces value bands to BTC's 'PE Ratio' (NVT), comparing on-chain volume to market cap. According to Edwards, this metric has reverted to a state of relative value after a period of overvaluation, indicating a normalization in valuation metrics.
Regarding Production Cost, the cryptocurrency has exceeded its production costs, buoyed by the Ordinals fee boost, signifying highly profitable mining and the potential for higher repricing. Edwards observes, 'Bitcoin has broken out of the cost of production in recent months, marking the end of the era of value Bitcoin.'
The Hash Ribbons indicator, described by Edwards as his initial on-chain metric, exhibits 'widening growth in Hash Rate locally,' indicating miners' confidence and network health.
A notable observation arises from the Miner Sell Pressure metric, as Edwards highlights, 'It's VERY high right now, comparable to 2017. This underscores profitable miners securing their gains and ETF demand depleting the supply.'
The BTC Yardstick and Hodler Growth Rate metrics suggest that BTC might be entering the early stages of a bull run, with an increasing number of holders selling into profits. However, Edwards suggests, 'Considering prior durations to cycle peaks, we still have some time to go.'
Supply Delta and Bitcoin Heater provide insights into the ratio of short-term to long-term holders and the aggregated market leverage, both indicating conditions that historically precede significant market movements.
Early Phases, Yet Deep Value Dissipates
Lastly, Edwards favors the BTC Macro Index, a machine learning model aggregating over 60 on-chain and macro metrics, signaling robust market expansion. 'We are witnessing strong expansion, in the nascent stages of a typical Bitcoin cycle,' notes Edwards.
In summary, Edwards' analysis foresees a multi-month uptrend for BTC, with potential volatility and pullbacks due to the accelerated pace of market developments in 2024 and the imminent next Halving. Edwards boldly asserts, 'All metrics unanimously suggest a substantial multi-month uptrend will likely unfold from this point.'
Concluding his insights, Edwards states, 'Bitcoin's deep value is a thing of the past. That opportunity has elapsed. You had a two-year window to acquire undervalued BTC. Instead, an exhilarating new chapter has commenced... Welcome to the Bitcoin Momentum era.'
As of the latest update, BTC is trading at $66,262.
