- Bitcoin is currently trading below $21,400, down more than 8% in the past 24 hours.
- Glassnode data shows that the actual price of bitcoin is $21,700.
- The price of BTC has fallen below the actual value prior to December 2018 and March 2020, the scenario being observed in June, July and August 2022 as well.
Bitcoin is down by more than 8% in the past 24 hours, causing the price of BTC to drop below its actual value.
In July, the cryptocurrency fell below the actual price level – around $21,800 at the time – before breaking higher to hold it up for 23 consecutive days.
On Friday, with BTC/USD breaking out around $21,320, on-chain analytics platform Glassnode share The chart showing the actual price had once again broken below the actual price.
According to the platform, the current real price of bitcoin is $21,700, which suggests that the market is recovering total losses.
#bitcoin Prices have broken below the actual price after 23 consecutive days based on market cost.
The actual value currently sits at $21,700, which reflects the total acquisition price, which is the value of the coins at the time they go off-chain.
Chart: https://t.co/za5BFAI6nC pic.twitter.com/rVY5uyzKnK
— glassnode (@glassnode) August 19, 2022
What is the real price of bitcoin?
On-chain analysis looks at the actual value as the value of all BTC when they were last transferred (bought), with the metric taking into account the circulating supply of bitcoin.
A measure of the value of these coins is equivalent to the coin’s ‘average cost basis’, and is not the same as the current price of bitcoin in the market. For example, at the time of writing, BTC was trading around $21,330, but the actual value was around $21,700.
With the last four occasions in December 2018, March 2020 and 2022 – June/July and now in August the price of bitcoin has gone below its true value several times.
Historically, a drop below the actual price of BTC marked cycle lows and was followed by an upside rally, on occasion reaching new all-time highs. However, the measure of how long the price stays below the metric varies.
In 2018, it took four months for the actual price to bounce above the metric, but less than two weeks in March 2020.
In June, bitcoin remained below real value for a month before making a brief upside.