**Bitcoin’s MVRV Ratio Signals a Critical Reset: What It Means for the Market**

Bitcoin’s latest price pullback has pushed its Market Value to Realized Value (MVRV) ratio back into a critical zone historically linked to macro correction lows and the early stages of market recovery. As the MVRV metric now reflects a valuation reset similar to those seen before major rebound phases in prior cycles, many in the crypto community are keeping a close eye on what might come next.

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### Why the MVRV Reset Reinforces Bitcoin’s Value Proposition

The recent bearish performance across the crypto market has been felt strongly by Bitcoin holders, with the MVRV ratio dipping into the critical 1.8 to 2.0 range. This zone is significant; in past corrections, it has often marked the foundation from which Bitcoin initiates a recovery.

Crypto market expert and ambassador, BitBull, explains on X (formerly Twitter) that for those unfamiliar, the MVRV ratio compares Bitcoin’s current market value to its realized value — essentially what investors actually paid for their coins. When this ratio approaches 2, it indicates that most holders are near their cost basis. At this level, there is little speculative greed remaining; only the conviction of those willing to hold through downturns.

Historically, this 1.8 to 2.0 MVRV range has aligned with major market bottoms — including in June 2021, November 2022, and April 2025. In each case, market sentiment felt broken, but Bitcoin was quietly resetting for another move higher. Now, as the MVRV ratio re-enters this critical zone amid recent massive liquidations and widespread panic, seasoned traders recognize a familiar pattern.

During periods when sentiment hits rock bottom, on-chain data typically tells a different story: one of exhaustion, not total collapse. BitBull sees the current phase as one of compression rather than capitulation, suggesting that while short-term pain remains, it could present a long-term opportunity. The same cycle that previously punished excessive leverage is now clearing out weaker hands, potentially setting the stage for a stronger market base.

“If history rhymes,” BitBull concludes, “this is the part of the story where the bottom gets written, not the top.”

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### Why Liquidity Outweighs Interest Rates in Driving Bitcoin

Beyond sentiment and valuation ratios, liquidity remains a crucial component in Bitcoin’s market landscape. According to full-time crypto trader and investor Daan Crypto Trades, the most influential macro factor for both Bitcoin and the wider crypto market is the total global liquidity in the financial system — not interest rates.

The correlation between global liquidity levels and Bitcoin’s price movements has been clear over the years. Recently, Daan has pointed out that global liquidity expansion has stalled and begun trending downward again. This shift has coincided with a halt in Bitcoin’s upward momentum, especially as profit-taking behavior typical during the 4-year market cycle increases.

Daan emphasizes, “Once global liquidity starts expanding at a rapid pace, the market environment for crypto will become significantly more supportive than it is currently.”

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**In summary, while Bitcoin’s MVRV ratio signals a critical valuation reset and widespread panic prevails, seasoned market observers see signs of opportunity beneath the surface. As market cycles continue to play out, global liquidity trends remain a vital force to watch for the next major move in crypto.**
https://bitcoinethereumnews.com/bitcoin/bitcoin-valuation-reset-mvrv-slides-into-macro-correction-territory-what-this-means/