Bitcoin News Today: Bitcoin’s Quarterly Realized Volatility Hits 70% as On-Chain Activity Slows to Multi-Week Lows

Bitcoin’s quarterly Realized Volatility has fallen to 70%, nearing levels last seen in September 2023 when the cryptocurrency traded at $26,000, according to data. This decline, while signaling a potential consolidation phase, raises questions about whether history could repeat itself. The current volatility level is far below the 236% peak observed in 2021, suggesting a broader moderation of market extremes [1]. As of the latest data, Bitcoin traded at $118,922, with a modest 0.59% daily gain [1].

On-chain metrics, however, reveal a cooling in activity. Transaction Count has dropped to 188,000, while Network Growth has fallen to 72,100—both multi-week lows per Santiment. These figures indicate declining user participation and a slowdown in new wallet creation [1]. Prolonged stagnation in such metrics often signals waning interest, though a macroeconomic catalyst or demand shock could reignite activity [1].

The Network Value to Transactions (NVT) Ratio has surged to 412, its highest level in recent months, according to Santiment. This sharp rise, often interpreted as a sign of overvaluation, highlights the growing disparity between Bitcoin’s market capitalization and on-chain transaction volume. High NVT readings typically accompany price tops or prolonged growth plateaus. However, the indicator may reverse quickly if network throughput rebounds, suggesting the imbalance could be short-term [1].

Bitcoin’s Stock-to-Flow Ratio, a key scarcity metric, has collapsed by 71.43%, per CryptoQuant. This sharp drop challenges core long-term valuation models, as the relationship between existing supply and new issuance has shifted significantly. While some analysts argue the model’s relevance has diminished post-halving, others view the decline as a potential early-cycle accumulation signal [1].

Miner profitability metrics also show signs of strain. The Puell Multiple, which measures miner revenue relative to historical norms, has fallen to 1.25—a 13% decline—indicating a challenging environment. Though the metric remains above the 0.4–0.5 capitulation threshold, continued weakness could reduce miner-led selling pressure [1].

The mixed signals paint a complex picture for Bitcoin’s near-term trajectory. While volatility compression and on-chain inactivity suggest a period of consolidation, historical patterns indicate such phases often precede major trend reversals. If fundamentals realign without further deterioration, a breakout could emerge, mirroring previous cycles [1].

[1] https://ambcrypto.com/bitcoin-volatility-hits-70-echoes-2023-lows-will-history-repeat-itself/

[2] Santiment (Transaction Count, Network Growth, NVT Ratio)

[3] CryptoQuant (Stock-to-Flow Ratio, Puell Multiple)