Bitcoin's 2025 Bull Case: Decoding On-Chain Metrics and Market Cycle Dynamics

Bitcoin's market cycle has long been a subject of fascination for investors and analysts. As of October 2025, on-chain metrics and macroeconomic indicators suggest the cryptocurrency is entering a critical inflection point. This analysis synthesizes recent data to argue that Bitcoin remains significantly undervalued relative to its historical growth potential, with a price target range of $150,000–$200,000 for the 2025 bull peak.

MVRV Z-Score: A Harbinger of Undervaluation

The Market Value to Realized Value (MVRV) Z-Score, a metric that quantifies the deviation of Bitcoin's market price from its realized price (the average cost basis of all on-chain holdings), currently stands at levels comparable to May 2017-when Bitcoin traded at just $2,000, according to Bitcoin Magazine. This suggests that the network is still in a phase where the majority of addresses hold Bitcoin at a profit, but systemic selling pressure remains muted. Historically, the MVRV Z-Score peaks sharply before bear market corrections, indicating that Bitcoin is far from reaching a critical overvaluation threshold.

Pi Cycle Oscillator: Reaccelerating Momentum

The Pi Cycle Oscillator, which tracks the interplay between the 111-day and 350-day moving averages of Bitcoin's price, has begun trending upward with greater conviction than the consolidation seen in 2024, as noted by Bitcoin Magazine. This oscillator acts as a leading indicator of institutional buying activity, as it reflects the alignment of short-term retail enthusiasm with long-term capital inflows. The current upward trajectory mirrors patterns observed in 2019 and 2021, both of which preceded multi-year bull runs.

Post-Halving Dynamics: Supply Squeeze and Illiquidity

Bitcoin's post-halving supply dynamics continue to tighten. As of October 2025, 74% of Bitcoin is illiquid (not moved in ≥2 years), and ~75% has remained dormant for over six months, according to XT.com. This "supply hoarding" behavior is a direct consequence of the 2024 halving, which reduced block rewards by 50%, incentivizing long-term holding. The shrinking float of available Bitcoin creates a scarcity-driven price floor, particularly as macroeconomic conditions normalize.

Bitcoin Cycle Master Chart: Room for Growth

The Bitcoin Cycle Master Chart-a composite of on-chain metrics including MVRV, NVT, and realized capitalization-indicates that Bitcoin is still operating within a healthy valuation range. The upper boundary of overvaluation, currently estimated at $190,000, has itself risen due to increased network adoption and institutional demand, per the Bitcoin Magazine outlook. This suggests that the market is recalibrating its expectations for Bitcoin's utility, with room for further appreciation before speculative excess becomes a concern.

Macroeconomic Tailwinds

Bitcoin's inverse relationship with the U.S. Dollar Index (DXY) remains intact, with the cryptocurrency benefiting from the expected reversal of the 2024 money supply contraction-a trend highlighted in the Bitcoin Magazine analysis. As central banks pivot toward accommodative monetary policies, Bitcoin's role as a hedge against fiat devaluation becomes more pronounced. Additionally, the unwinding of the 2024 bear market's risk-off sentiment has created a fertile environment for risk-on assets like Bitcoin.

Network Value to Transaction (NVT) Ratio: Usage-Driven Valuation

The NVT ratio, which compares Bitcoin's market value to its on-chain transaction volume, has crossed the "golden-cross" threshold of 1.51, a level previously identified in the XT.com piece. This level historically signals that Bitcoin's valuation is supported by fundamental usage rather than speculative fervor. The rising NVT ratio underscores growing adoption in real-world transactions, particularly in cross-border payments and institutional custody solutions.

Conclusion

Bitcoin's 2025 bull case is underpinned by a confluence of on-chain and macroeconomic factors. The MVRV Z-Score and Pi Cycle Oscillator suggest the market is in a pre-peak accumulation phase, while supply-side metrics and the NVT ratio confirm that valuation is driven by fundamentals. Investors should remain cognizant of the historical 6–12 month post-halving cooldown period, but the current trajectory points to a breakout in late 2025 or early 2026. For those positioned for the next leg of the cycle, Bitcoin's undervaluation and tightening supply dynamics present a compelling case for long-term exposure.