Definition ∞ Bitcoin Realized Cap is a market valuation metric that calculates Bitcoin’s market capitalization by using the price of each Bitcoin when it last moved on-chain, rather than its current market price. This metric provides an estimation of the aggregate cost basis of all Bitcoin in circulation. It offers a more accurate view of the network’s value held by long-term investors.
Context ∞ Analysts often use Bitcoin Realized Cap to identify macro market cycles and investor sentiment, particularly during periods of market stress or recovery. When the market price falls below the realized price, it traditionally signals a potential market bottom. Discussions frequently concern the metric’s effectiveness in predicting price movements versus traditional market capitalization.
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