Crypto news highlights how, after a strong Q4 2024 with Bitcoin hitting new all-time highs, the market now appears to be stalling.
However, the recent dip in cryptocurrency prices has many investors feeling uneasy.
Regulatory concerns, tariff fears, and pullbacks of 20-30% across major tokens have many wondering if the bull run is over.
However, the data tells a different story, suggesting that the market is merely catching its breath before taking another leap forward.
Historical Pullbacks Are Par for the Course
Pullbacks are common in crypto markets, especially after strong rallies. Bitcoin’s “MVRV Z-Score,” a metric that measures whether Bitcoin is undervalued or overvalued compared to its fair market value, is signaling that the market may be close to a bottom.
The MVRV Z-Score tracks Bitcoin’s market cap relative to its realized value, which is the average purchase price for all Bitcoin holders.
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When this score is below zero, Bitcoin is generally undervalued and has historically marked market bottoms.
Currently, the MVRV Z-Score is near zero, indicating that Bitcoin’s price is close to its historical value. In fact, the metric suggests the market is ripe for the next rally.
When the Z-score is below zero, it often precedes significant upward movements, which is consistent with past bull cycles.
If this pattern holds, we could be nearing the final, powerful leg of this crypto bull run.
Crypto News: Macro Economic Data Supports Growth
Despite the recent volatility in crypto markets, the broader economic picture remains strong.
According to a post on X by Lumida Wealth CEO, Ram Ahluwalia, the latest reports from purchasing managers show an increase in buying activity. This signals future economic expansion.
Additionally, he points out that U.S. companies continue to outperform their earnings targets, and the U.S. economy remains on a growth trajectory, supported by strong GDP numbers.
The continued growth in traditional markets is crucial for the overall health of the crypto sector.
Historically, stable or rising traditional markets have fueled positive crypto news, as increased liquidity and investor confidence boost crypto asset performance.
Even though the market may feel turbulent, the macroeconomic data indicates that the global economy is not in decline. This could provide the necessary support for crypto prices to climb again.
Crypto Still Follows Historical Patterns
Looking at the crypto market over the years, clearly, the current pullback fits a well-worn pattern. As with past bull runs, significant dips are followed by a resurgence.
The rally in Q4 2024 may have been driven by increased institutional interest, regulatory clarity, and new all-time highs for Bitcoin and other cryptocurrencies.
However, the pullback seen in early 2025 is not a sign of a dead market. Instead, it represents the natural ebb and flow of the market.
The historical data backs this up. In previous cycles, crypto news has highlighted steep pullbacks of similar magnitude, followed by strong rebounds as demand surged back.
While the volatility may seem alarming, it is part of the growth process for cryptocurrencies, especially during bull markets. This correction phase is likely just the calm before the storm of the next major rally.