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- Peterson’s LPF metric forecasts Bitcoin dip to $70k, citing historical bear market patterns and current trade tensions.
- Sudden tariff rollout leaves markets volatile; Bitcoin’s short-term path hinges on investor response to trade policy shifts.
The Bitcoin bull cycle has likely concluded, according to analysis of on-chain metrics. A key indicator, the Realized Cap, measures the total capital entering Bitcoin based on the cost basis of coins moved on the blockchain.
#Bitcoin bull cycle is over — here’s why.
There’s a concept in on-chain data called Realized Cap. It works like this: when BTC enters a blockchain wallet, it’s considered a “buy,” and when it leaves, it’s treated as a “sell.” Using this idea, we can estimate an average cost… pic.twitter.com/xDHRin8N1K
— Ki Young Ju (@ki_young_ju) April 5, 2025
This contrasts with Market Cap, which reflects Bitcoin’s price multiplied by its circulating supply. When Realized Cap rises while Market Cap stalls, it signals capital inflow without price growth—a pattern now observed in Bitcoin markets.
Realized Cap tracks actual purchases by assigning a value to each Bitcoin based on its last on-chain movement. For example, if a wallet acquires Bitcoin at $50,000, that price anchors its contribution to Realized Cap until the coins move again.
Market Cap, however, shifts with Bitcoin’s latest exchange price. Small trades can disproportionately impact Market Cap when sell orders are scarce. MicroStrategy’s strategy of issuing debt to buy Bitcoin illustrates this: limited capital deployment inflated their holdings’ paper value during low sell pressure.
So how can we tell if market cap is likely to rise relative to the capital being invested? Realized Cap shows how much actual money is entering the market, while Market Cap reflects how the price is reacting. If Realized Cap is growing but Market Cap is stagnant or falling, it means capital is flowing in, but prices aren’t rising—a classic bearish signal. On the flip side, if Realized Cap is flat while Market Cap is surging, it suggests that even a small amount of new capital is driving prices higher—a bullish sign. – Ki Young
Currently, Realized Cap growth outpaces Market Cap, indicating capital inflows without corresponding price gains. This divergence aligns with bear market conditions, where heightened sell pressure neutralizes buying activity. Historical data shows similar patterns precede prolonged downtrends. For instance, when Bitcoin neared $100,000, high trading volumes failed to lift prices due to excess selling.
U.S. Tariffs and Bitcoin’s Price Path: Analysts Weigh Conflicting Forecasts
New U.S. trade policies under former President Donald Trump have injected uncertainty into global markets. Starting April 5, a 10% tariff on all exports to the U.S. took effect, announced just three days prior.
Financial markets reacted swiftly, with analysts calling the move a direct challenge to international trade stability. Against this backdrop, Bitcoin faces diverging predictions: some see it as a hedge against turmoil, while others warn of short-term declines.
Trump’s tariff decision follows a pattern of abrupt policy shifts seen during his prior administration. Markets initially dipped as exporters braced for higher costs, but attention soon turned to cryptocurrencies.
Jim’s loss is Bitcoin’s gain.
A 1987 style mega crash will push Bitcoin to $220,000 this month as trillions in wealth seek the ultimate safe haven: Bitcoin.
— Max Keiser (@maxkeiser) April 5, 2025
One commentator argued that economic crises historically benefit Bitcoin, suggesting a potential surge to $220,000 if market conditions mirror 1987’s volatility. This view hinges on Bitcoin’s perceived role as a “safe haven” during periods of traditional asset sell-offs.
Not all analysts share this optimism. Timothy Peterson, a market strategist, projected on April 3 that Bitcoin could drop to $70,000 within ten days. His analysis relies on the “Lowest Price Forward” (LPF) metric, which tracks Bitcoin’s long-term floor prices by comparing past bear markets. Peterson’s chart shows that Bitcoin often retraces to specific levels before stabilizing, a pattern he believes will repeat.
Bitcoin to $70k in 10 days?
While this chart is not a prediction, it does provide data-driven expectations for what Bitcoin could do. If it continues to track along the 75th percentile bear market range, then 70k would be the practical bottom.
This aligns with my other post… pic.twitter.com/2fRO4vbVvy— Timothy Peterson (@nsquaredvalue) April 3, 2025
The LPF model identifies support zones where buying activity traditionally offsets selling pressure. Peterson’s $70,000 target aligns with these historical trends. Trade disruptions could either drive investors toward Bitcoin as a non-sovereign asset or amplify risk aversion, pushing capital into traditional safe havens like gold or Treasuries.
