Bitcoin: is it still worth getting in?

Bitcoin continues to rise from record high to record high. Is it still interesting to get in now or has the crypto train already left?

In this article you will discover:

• What key statistics say about Bitcoin's future price trend

• Whether mood indicators predict a crash

• What role investors play

New record for Bitcoin: Headlines like this one are once again drawing private investors to the world of crypto. However, many people doubt whether an investment is still worthwhile given the impressive price development in recent years. A look at the on-chain statistics and indicators provide insight on the further course of the price.

On-chain statistics point to further course potential

The MVRV-Z score is one of the best-known indicators to assess Bitcoin's valuation. In the past, it signaled key peaks within two weeks. The score is calculated by dividing Bitcoin's market capitalization by the last price paid (realized value). The higher the score, the more overheated the market is. Bitcoin still seems far from a peak with a score of 2.9. In 2021, the score reached 7.13, and in 2017 it was even double-digit.

The Puell Multiple takes into account the supply - Bitcoin miners and their income. This indicator is calculated by dividing the daily value of Bitcoin in USD by the 365-day moving average. This indicator is also far from previous peaks with a value of 1.02. In 2021, the Multiple reached almost 3.5 and even 6.6 in 2017.

The Pi Cycle Top Indicator combines the 111-day moving average (111DMA) with double the 350-day moving average. This indicates when the market is so overheated that the 111DMA crosses the double value of the 350DMA. Currently these values are around USD 119,000 and USD 64,000 respectively - so still far apart.

Thus, based on historical comparisons, the most common on-chain statistics predict that prices will continue to rise in the coming months. When making a buying decision, however, it is wise to also look at investor sentiment and the state of Bitcoin ETFs.

Institutional 'FOMO' in Bitcoin ETFs?

Spot Bitcoin ETFs have been very popular lately. On Nov. 7, the iShares Bitcoin Trust reached a new record trading volume of more than USD 4.1 billion. That day alone, 1.1 billion USD flowed into the BlackRock product. Institutional investors also seem to be experiencing FOMO (fear of missing the boat). As acceptance of BTC increases, more and more investors are considering BTC investment, especially with the Trump election actively legitimizing it. These inflows through regulated products could further boost the BTC price. See also this graphic from Bitwise.

MicroStrategy - the software company whose extreme Bitcoin strategy now virtually serves as a leveraged Bitcoin ETF - also continues to buy BTC. Founder Michael Saylor wants to invest USD 42 billion in Bitcoin over the next three years. Yesterday, the company bought another BTC worth two billion USD. Should other large companies follow suit, this may not only further limit the BTC supply but also serve a signaling function.

Investors are greedy - too greedy?

The Crypto Fear & Greed Index, which measures data such as volatility, buying volume and social media activity, is currently at 80 - Extreme greed. Investors are very optimistic about the continued price development of BTC and other cryptocurrencies. But as investor legend Warren Buffett said, "Be greedy when others are afraid and afraid when others are greedy." This may indicate that a correction is coming. Still, a sharp rebound in the crypto market can never be ruled out, especially after a recent rally. During the 2021 bull market, the index remained at this level for months and the BTC price rose from record high to record high.

Long-term savings plan

Since history does not repeat itself, it is not wise to rely blindly on these indicators. Overall, however, they provide valuable insight into the state of Bitcoin. Despite the impressive rally, BTC still has growth potential for the coming months. Donald Trump's recent victory and institutional acceptance could give the asset a solid long-term boost. Asset manager VanEck, for example, predicts a price of $3 million by 2050.

In the volatile crypto market, price drops are always possible. However, finding an ideal entry point is not necessary with BTC's long-term potential. To absorb price fluctuations, a Bitcoin savings plan, as is common with ETFs, is an option. Investors can take advantage of low prices to buy cheaper and higher prices to increase the value of their BTC holdings, which can also provide a quieter night's sleep.