Bitcoin's Realized Market Cap Turns Positive in 5 Months...End of the Loss Market?

▲ Bitcoin (BTC)/AI Generated Image

As Bitcoin (BTC) recovers to $80,000 again, the on-chain indicator, Realized Market Cap, has turned positive, strengthening signals of market recovery. Analysis suggests that the trend of sustained loss realization during the correction period is easing, and capital is flowing back into the Bitcoin market.

Bitcoinist reported on May 11 (local time) that as Bitcoin's price returned above the key $80,000 level after Sunday's rebound, major on-chain indicators began to show bullish signals again. Among these, Realized Market Cap was presented as a key indicator for assessing market sentiment, investor behavior, and capital inflows.

Realized Market Cap is an indicator calculated by subtracting realized losses from realized profits. It reflects the value newly created or lost in the market, showing whether investors are realizing losses or if profit-taking and capital inflows are expanding. CryptoQuant data analyst DarkPost analyzed that, based on the monthly chart, this indicator is showing recovery signals, which means capital is flowing back into Bitcoin.

According to the article, Bitcoin's Realized Market Cap re-entered positive territory as of Sunday, with its growth rate reaching 0.25%. Although the increase is not yet significant, it is meaningful because it marks a recovery after a sharp negative decline of over 2.6% in February this year. During that correction period, investors who bought Bitcoin at high price levels realized losses, which led to a decrease in the Realized Market Cap.

DarkPost assessed that while it's difficult to say the overall market sentiment has fully turned bullish yet, the current phase is a process of holdings moving from weak hands to strong hands. This explains that the market structure is gradually improving as prices reach attractive levels sufficient to draw in new investors.

Another key indicator, Net Realized Profit/Loss, has also turned positive. On-chain Mine reported that this indicator entered positive territory for the first time in about five months. This means that more coins are moving in a state of profit rather than loss, indicating a gradual recovery in market confidence and investor sentiment.

However, it was also explained that the positive shift in Net Realized Profit/Loss does not immediately signify the entry into a full-fledged bull market. Bitcoinist stated that this change is a clear signal that the market recovery process is underway. Based on the simultaneous improvement in Realized Market Cap and Net Realized Profit/Loss, the Bitcoin market has entered a phase of confirming capital inflows and investor sentiment recovery after the correction period.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*