The cryptocurrency market has entered a period of a prolonged drawdown. Over the past few days alone, the total capitalization has shed slightly less than $90 billion.
This came on the back of Bitcoin’s price seeing its worst quarter in the last decade. It closed June below $20,000, which also made it one of the worst monthly performances to date.
- At the time of this writing, BTC continues trading below $20,000 and opened the new month in the red as well.
- According to an analyst from popular resource CryptoQuant, the bottom may be found at around $15,000, at least according to some indicators.
- The first one is the realized market capitalization. The analyst explains that it “represents the market cap taking into account the price each coin was last moved (weighing less dead coins).
- The second indicator that they use is the delta cap. It shows “the realized cap minus the moving average calculated over the entire period.”
- Based on the above, the analyst argues that:
Historically, the market cap has only been between these levels in peak bear markets. 2018 especially shows that BTC only entered that zone after we got our capitulation crash. In 2014, it was the same, except the bottom was more extended in time.
- Comparing the above to the present price action, the analyst concludes that BTC has already traded below the realized cap, which also saw the drawdown lose momentum. However, they also argue that:
The coming recession could destablize things further. If we end up getting worse macroeconomic conditions, we could see price go slightly below $15K level (delta cap).
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