The Bitcoin market continues to pressure short-term and medium-term participants. According to an in-depth analysis of on-chain metrics, the average loss for active investors in the first cryptocurrency is currently around 20%. This conclusion is based on the AVIV (Active Value to Investor Value) indicator, which is currently in the depreciation zone.
The key indicator for assessing the situation is the True Market Mean (TMM). Unlike standard metrics, TMM excludes coins that have not moved for a long time and whose cost basis is no longer relevant. Some of these assets are considered irretrievably lost, making them "illiquid" for current pricing.
Currently, TMM is estimated at around $76,700 and acts as a strong resistance level. It was this mark that triggered a wave of selling in May, when many preferred to lock in losses and exit positions rather than continue holding assets in anticipation of a reversal.
What does the AVIV ratio show?
Analysts view AVIV as the ratio of the current market valuation to the cost basis of the active supply. Currently, this indicator fluctuates around 0.8, which clearly points to a depreciation zone. This means that the active group of investors is, on average, sitting at a 20% loss. The level is noticeable, but as emphasized in expert circles, it is not yet comparable to the depth of past bear markets.
In previous cycles, AVIV dropped to 0.5–0.6, which corresponded to losses of 40–50%. However, for Bitcoin to bounce, it does not necessarily need to reach such extreme values. This is due to the scale of asset adoption in the current cycle, which has grown significantly thanks to institutional interest and ETFs.
Cyclicality has not been canceled
Despite the influx of billions of dollars from institutions, the fundamental cyclicality of Bitcoin remains unchanged. The market still dictates its own rules, and even large players cannot override them. In such a phase, investors should maintain humility before market cycles and not try to "outplay" the mechanics embedded in the protocol.
Cryptalist's comment: The current situation is a classic example of a "bear trap" for the inexperienced. A 20% loss for active traders is painful, but not critical for the market structure. Until AVIV reaches levels of 0.5–0.6, it is premature to talk about a bottom. However, it is precisely such periods that often precede the most aggressive accumulation phases. Experienced players use panic to enter, not to flee.