The Bitcoin market is going through a challenging period. My on-chain data analysis shows that active investors in the leading cryptocurrency are currently at an average loss of 20%. The key indicator pointing to this is the AVIV ratio (Active Value to Investor Value), which has settled in the depreciation zone around the 0.8 mark.
What is True Market Mean and how does it work
For an accurate assessment of the situation, I use the True Market Mean (TMM) indicator. Its advantage is that it excludes coins that have not moved for a long time from the calculation. Such assets, partially lost or forgotten, no longer reflect the real market picture. Currently, TMM is estimated at around $76,700 and acts as a resistance level. This was especially evident in May: many investors chose to exit the market without a loss rather than continue holding positions.
The AVIV ratio, which I track, reflects the current market valuation relative to the cost basis of the active supply. A value around 0.8 means that the active group of investors is losing an average of 20%. This is a notable level, but it is not yet comparable to past bear markets.
Why the current situation is not yet the bottom
In previous cycles, AVIV dropped to 0.5–0.6, corresponding to losses of 40–50%. However, for Bitcoin to bounce back, it does not necessarily need to reach such extreme values. The current scale of asset adoption, especially with the influx of institutional money and ETFs, could change the dynamics.
Nevertheless, I urge caution. Despite billions of dollars flowing into the market, Bitcoin still dictates its own rules. Cyclicality has not disappeared, and every market participant should take this into account.
My expert opinion: We are not seeing a classic bottom yet, but the current depreciation zone is a signal for heightened vigilance. The market could make a sharp reversal, but this requires either a powerful catalyst or a complete capitulation of weak hands. In conditions of uncertainty, it is better to stay calm and not give in to panic.