Bitcoin MVRV Indicator Signals: Is it the bottom of the bear market or another trap?

As of March 2026, Bitcoin is currently trading around $71,000. This is approximately a 43% decline from its all-time high of about $126,200 recorded on October 6, 2025. A key indicator gaining attention during this period is the MVRV ratio. The ratio has fallen to 1.1, the lowest level since early 2023 when Bitcoin was around $23,000, and many wonder if this signals a market bottom.

The Meaning of the MVRV Ratio and the Current Situation

The MVRV ratio stands for Market Value to Realized Value Ratio. Simply put, it compares Bitcoin’s current market value to the average purchase price of all coins, based on the last time they moved on-chain.

Realized value is the sum of the prices at which all coins last moved on the blockchain. When the MVRV ratio drops below 1.0, it indicates that a significant portion of the supply is in an unrealized loss state. This is often interpreted as Bitcoin being undervalued at the current level.

Historically, when the MVRV approaches 1.0, it has coincided with cycle bottoms. After the MVRV fell below 1.0 in early 2023, Bitcoin experienced a strong rally of over 500%. This is why the current low level is attracting attention.

Differences from Past Cycles and the Implication of a Flat Market Top

However, the current situation shows subtle differences from previous cycles. At the October 2025 peak, the MVRV ratio was 2.28. While high, it is lower than the extreme levels above 3.5 seen at the 2017 and 2021 peaks.

This difference is significant because, as CryptoQuant contributor Crypto Dan points out, if this bull market’s peak was unusually gradual, the subsequent correction might also differ from past sharp downturns. In other words, a slow decline rather than a rapid drop could be possible.

Z-Score and Long-Term Holder Behavior Indicating Signals

The related indicator, the MVRV Adaptive Z-Score, is signaling more aggressively. According to CryptoQuant contributor GugaOnChain, it currently stands at -2.66, which is categorized as a “panic sell” phase. This level is even lower than the extreme lows seen during the 2015 and 2018 bear markets, the March 2020 crash, and the 2022 capitulation phase.

Data from blockchain analytics firm Glassnode shows shifts in long-term holder sentiment. On February 6, about 245,000 BTC were moved out of long-term holdings, a speed similar to distribution patterns observed before previous cycle bottoms. This suggests even long-term holders are starting to sell, reflecting extreme bearish market psychology.

Why Caution Is Warranted and Market Uncertainty

However, not all analysts interpret these indicators as immediate signs of a bottom. Several market analyses cited by Cointelegraph suggest that Bitcoin’s potential low could form by Q4 2026, with target prices in the $40,000–$50,000 range. This indicates there may still be room for further downside.

The Bitcoin realized profit-to-loss ratio is also approaching 1.0, indicating realized losses are surpassing realized gains across the network—a potential inflection point. Historically, such crossovers have often been followed by prolonged periods of additional selling rather than immediate recovery.

Indicators like the MVRV ratio are just one of many data points used to understand the market; they are not precise timing tools. While some interpret these extreme signals as signs that the bottom is near, others believe further correction is needed. Investors should consider these complex signals comprehensively before making decisions.