Why This Bitcoin Bottom Might Be Different

[00:00:00]Today, an intense episode on the Bitcoin market. We'll go deep into all the metrics that we are watching here at the Bitcoin layer. I'll give you my opinion on whether the Bitcoin price is heading back below the lows that we had earlier this year. We will also dive into Yan Bergman, our head of Bitcoin research, his latest research piece. And of course, we will be looking at charts from our research terminal. This is tbl pulse. You guys are probably familiar with it. Now, if you aren't, make sure you get started for free at research.thebitcoinlayer.com.

[00:00:42]And then of course, if you are members of TBL Pro or even just a customer of TBL Pulse as a standalone product, you guys have the entire full suite of charts and all the information that I'm going to go into today.

[00:01:02][music] All right. So, for TBL pros, this one hit your inbox this morning, but I want to share it with you all today because Johan wrote a great piece and he's also teaching us, not only you, but me as well. He's teaching me how to use all of these charts that he has for us in TBL Pulse. Now, we've designed this from multiple angles. We have our proprietary liquidity metric TBL TBL liquidity and then we've turned it into a buy sell signal that is supposed to give you a condition on the market from macro. So a completely endogenous index to Bitcoin with looking at the interest rate market, US treasuries and DXY the US dollar versus other fiat currencies. But we ha we have the TBL liquidity component. We have all of our macro charts which which are we're looking at.

[00:02:01]And those by the way are available to everyone for free. Again, research.thebitcoinlayer.com to get started. And then we have our Bitcoin tab. And this is what Johan has brought to the Bitcoin layer. a ton of expertise when it comes to someone who is not only looking at the suite of markets across exchanges, derivatives, platforms, but also connected with a full node looking at the blockchain data himself. And he's designed an incredible tools kit for you guys at home. So, I want to show you what he's written, but then click on the charts that he has linked to you guys for uh as TBL pros and then show you how to use it. And the reason that I decided to open this one up is because when I was going through the charts, I discovered things inside TBL Pulse that I didn't know. And I'm happy that I learned them and I that's what I'm here to share with you today.

[00:03:03]So Johan's title bit uh bulls are bracing for 45,000 while the data says it's becoming less likely. So he starts with are we entering disbelief? Bitcoin is back in disbelief territory at least according to our framework. Now I want to show you what he means means by disbelief territory because you guys might not be familiar with this Bitcoin state grid which is the main chart here. So, I'll go to the grid here. I'll scroll down and I'll link to the chart and it'll open up my TBL pulse screen uh for you guys. And what you see here is Yan's framework summarized in one picture. I love the state grid. It shows you it shows you a lot. So, let's discuss it.

[00:03:54]On the yaxis is valuation and on the xaxis is trend. And I'll explain what both of these things mean, but that is the starting point here where we're looking at Bitcoin on both trend and valuation.

[00:04:12]And then we're plotting [clears throat] them against each other on this XYaxis.

[00:04:17]And I will show you here in a second that Bitcoin behaviorally demonstrates a pattern on where it spends time amongst this grid. And these are quantitative metrics here, trend and valuation. And so I'll I'll explain quickly what this means here. The valuation score which he gives is on a percentile basis between 0 and 100. And it tells us that based on Bitcoin's valuation metrics, and he has several that he uses, it's a confluence of them.

[00:04:57]Based on these metrics, this is where Bitcoin's price is today relative to that, the average of those valuations.

[00:05:09]And so what you get from that is this idea of low or high or said otherwise, cheap or expensive relative to history, Bitcoin's history. And every time valuation is low, it's the market believing essentially that Bitcoin is not as valuable as they once thought. every time it's high. What that means is that the percentile basis is high. And so the conclusion from that is that the market believes that Bitcoin is worth more than its historical averages. So that's when there's energy and even bordering on euphoria, which is this zone up here.

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[00:07:53]So capitulation is in the low zone because that's when people give up. So from capitulation to euphoria, you can then see on the yaxis what we're dealing with. Then on the trend side, up or down, that is very self-explanatory here. What we're talking about is are the underlying momentum and trend metrics in Bitcoin positive or negative. So, is it going up or is it going down? And you can see that we are somewhere in the middle right now. It's still negative because where is Bitcoin trending? Well, it's edging up. I started by saying that Bitcoin is up about 14% off the lows.

[00:08:37]That's really good. but down well over 50% in terms of peak to trough. And so that's why Bitcoin is toward the middle but still toward this side. The long-term trend has still not shifted positive yet even though there's uh some good short-term price action. And so that's what the grid gives us. It's it's where Bitcoin is on trend in valuation.

[00:09:04]Now, I want to show you this dwell percentage here because this is one of my favorite metrics. It says that this shows the share of history spent in each regime.

[00:09:16]So, I'll click on that dwell percentage and you'll see it pop up here that 24% of Bitcoin's entire life is spent down here in this capitulation zone and another 15% here in disbelief. So that means that for 40% of Bitcoin's life, it's in an area where the valuation is very low historically and people have basically given up or just don't believe that it's really ever going to come back. And so I love these these words that we use here. If you guys remember, we actually had this into four quad, it was a state quadrant where we where we had basically, you know, upper right, upper left, etc. But we separated it out because it was there was a chance here for us to get even more granular and give you guys more signal. So, I'm [clears throat] going to take the dual percentage off here and then I want to show you the heat map.

[00:10:13]The heat map is very interesting to me.

[00:10:18]This heat map shows you where Bitcoin spends the time in this range. And so, as you can see here, the reason that this is black is somebody asked this question on one of our free webinars that we did when we were uh starting up TBL Pulse and trying to give us uh you guys some education on how to use the tool.

[00:10:40]The reason that this area is black here means that Bitcoin doesn't spend any time here. Well, why? Because when the trend is way up, the price isn't going to be low anymore valuation wise. So, it's going to creep up here. So, when the trend is up, that's why that's why Bitcoin gets into a more expensive valuation because it's been trending up.

[00:11:01]And so, this is the way this is the way to look at this chart. It's like an ellipse. Essentially, it's like an ovalshaped orbit around this center zone. And Bitcoin does spend time in the middle here where it's uncertain what it is, but in in a way it's following this el ellipse where it goes from capitulation to disbelief to hope to optimism to euphoria to greed to complacency to anxiety back to capitulation.

[00:11:36]And that's and this whole ellipse, this doesn't just happen in the four-year cycle. And that's something that I also really really like about this this uh valuation metric here. It doesn't occur every four years. And that allows us to separate ourselves from the 4-year cycle anchoring. It doesn't mean we have to to we have to unlearn it, but you have to unanch anchor yourself from it.

[00:12:09]And I think that can free you up to the full range of possibilities because we love basian thinking here at the Bitcoin layer. And what it really is, it's a way to think prob probabilistically.

[00:12:24]You want to be able to see the entire spectrum. And that's when you guys read what I write at TBL Pro in my Monday letters. I'm trying to give you my opinion, devil's advocate, maybe the worst case scenario. For example, many months ago, many months ago, I was writing to you guys, hey, play play devil's advocate with yourself. What if the United States dollar strength and the strength of the dollar system is firming up here in 2025 and early 2026 and that that firming up of the system releases some of the demand for Bitcoin as a hedge against the dollar system collapse.

[00:13:13]You have to be able to think like this.

[00:13:16]And I was writing like that even though, you know, I might have my own bullish bias for Bitcoin because I'm a Bitcoiner and a longtime Bitcoiner. I have a bullish bias because I've seen it cycle up and down. So, what I don't want to do is get people like you to panic sell when Bitcoin is going down. I don't want you to panic sell. I do want you to understand that it cycles up and down and that at certain points we have to have caution and that for those that are willing to engage get involved in your hedging activities and take advantage of Bitcoin's volatility harnessing volatility either through active trading asset allocation or underwriting options or playing in the insurance market in any way essentially selling options which we are starting to model out in our TBL model portfolio [cough] available to TBL pros.

[00:14:18]This type of active management around Bitcoin's volatility can and should be a good thing. But that type of strategy is not for everyone. We don't provide financial advice for the record. We don't manage money and we are not a registered investment advisor. So please use our information as research education purposes only. Do your own research and ask your own financial professionals before ex uh before engaging in these types of trades. So I know that there are people that are active and there are people that are passive that watch and listen and read to the Bitcoin layer. Therefore, I have to maintain a or let's say I think it is best for me to maintain a underlying bullish bias and a long-term outlook when talking about the Bitcoin market such as I believe Bitcoin's price will be much higher than it is today in three, five, 10year time horizon. And so I think a a an allocation to Bitcoin is a good thing for all people especially especially young people who can afford to wait and wait out volatility. So that's the underlying bi bias. But now we have become much more quantitatively equipped across macro and Bitcoin, which is what we do at the Bitcoin layer. So we're talking from liquidity to Bitcoin itself. And we named Johan the head of Bitcoin research at the Bitcoin layer because that's what we needed. we needed someone who could give us the Bitcoin native side uh alongside my macro background.

[00:16:19]So, what we're doing here with this entire framework is we're zooming in.

[00:16:27][clears throat] And Johan does a great job of zooming out and expressing why he believes Bitcoin is a great asset to own long term. And therefore it makes him more vocal in being bullish when we are essentially anywhere below this this area or in this capitulation zone. anytime we're in here, it's either, hey, it's cheap, but it's probably not done yet and could go lower to, hey, it's cheap, but the worst might be behind us, which is, you know, spoiler alert, that's basically where he is in his analysis. And a great feature here is that you can look at this over time. So, not only can you look at it where it was three months, you know, one year, two year, five year ago, and you can see how Bitcoin travels really through time through these different regions. But you can also look at different points in time and just go back in time and see where Bitcoin was.

[00:17:30]And that way you can see, yes, it travels around. What's the pattern? And you know, what is the behavior? That's what we're really trying to get into.

[00:17:41]Sometimes people ask me, you know, what's the one book I should read about markets or give me that holy grail book.

[00:17:47]Well, there is no holy grail book, but one of the ones that I always do suggest to people is thinking fast and slow because thinking fast and slow is a behavioral economics masterpiece. It explains to us that essentially the opposite of what they teach you in classical economic theory or I should say in school in United States schooling economics is that people make rational decisions and this is the way that you think about things. Well, it's the opposite. People don't make rational decisions. They make decisions based on their heruristics and their understanding of the situation which is highly emotional. It's a psychological exercise to think about how any of this stuff is moving around. So behavioral economics is the way and when we do technical analysis and we do charting I look at candlesticks as you guys know what am I doing? I am looking at the behavior of buyers and sellers on a chart on a time series. A chart is a time series. Forget even the forget the word charts. Forget the word technical analysis. It's time series analysis that we do. The xaxis by the way is time. The y-axis is the price. So what we are doing when we look at the markets both from this behavioral standpoint, we'll get into other behavioral aspects of this with Johan as we get deeper into this video, but just in terms of explaining who we are as analysts, we think about behavior. That's the dominant driver of demand. And in Bitcoin, available supply, not created supply. Created supply is algorithmic in Bitcoin, which makes it highly unique.

[00:19:46]But available supply means what? How many people that own Bitcoin are willing to sell it. And demand of course is how many people are willing to buy it. So demand and supply is what drives a price. Nothing else. Everything else is either a driver of demand or a driver of supply. And so how do you how do you observe changes in demand, changes in available supply in Bitcoin? We can do it with the price and we can do it with the the chain of blocks itself. So and and then of course we can do it with the trading activity on now exchanges derivative exchanges and option options exchanges and we can do it with the options observing the options on Bitcoin ETFs and observing even options on MSTR.

[00:20:46]So, Bitcoin gives us an enormous amount of behavioral data to work with because it's prices from all over the place and prices are the result of demand and supply. This is a long behavioral economics rant, but what we do is behavioral economics, and that means analyzing the way that buyers and sellers come to the market and the timing and especially not only just the timing, but the time series, which is why we look at charts. We look at things over time.

[00:21:26]That's how we measure the changes in behavior. And also that's the that's one important segue to one of the dominant themes [snorts] for us as a just as investors.

[00:21:42]But something that I try to communicate to students that are learning investments and learning markets, rate of change is what matters because if you wait till everything is good and the headlines show it, it's already been going up. What you want to look for is a sign that things have started to get less bad. So that rate of change goes from severely negative to slightly negative and then slightly negative to neutral and then neutral to then slightly positive. And that shift towards neutral to slightly positive by the way has not arrived yet. And I can give you one example metric. It's the 200 day moving average. It's still sloping negative.

[00:22:29]And so if Bitcoin can get above that, but that can also get to a rate of change of zero and then start heading positive, then you know that you're already essentially entering the bull market or that momentum is coming back and that the majority of investors have arrived.

[00:22:49]But when does it go from very sharply negative to only slightly ne uh sloping negative? And when does it go from sl slightly sloping negative to sloping flat? That is that is how to get ahead of markets. And everything that we do can be thought of in terms of looking at the slope of a 200 day. We're trying to measure in corners of the market. Where is it getting? Where is it going from bad to less bad? Where is it going from slightly bad to neutral? and where is it going from neutral to now leaning positive? That's the way that Johan thinks. That's why we brought him on.

[00:23:32]He's a very strong analytical thinker but operates completely independently of me and and that's important for you guys to understand that Johan is not a he's not my assistant researcher. He's and he's not even a co-ressearcher to us. He is an independent Bitcoin researcher and because he's the only one of a kind at our shop, he becomes the head of Bitcoin research and I do not I do not you guys know I don't proof his stuff before it goes out. That is done by Augustine and Damian. But the he doesn't ask me is it okay if I go from bullish to bearish, bearish to bullish. That is 100% him.

[00:24:20]And it is important that you guys know that at home so that when you're following Johan, you understand this is him. And then we and then we integrate what he's doing to what we are doing.

[00:24:32]Because what are we trying to do here? We're trying to give you the maximum signal possible. So maybe you are more interested in the macro side in TBL liquidity. Maybe you're more interested in the Bitcoin native metrics that Yan is doing. And maybe you are interested in the combination. Maybe you're here just for my candlestick analysis because in some ways I feel it's the most pure looking straight price and time series of prices. So we welcome all walks. It does take all types of analysis to make a good investor. So maybe consider adding one other dimension to your repertoire as an investor as you go through learning the ropes and trying to become a better investor as we all are.

[00:25:19]The reason that I love what I do is I'm trying to become a better investor and a better thinker which will make me a better investor really at all times.

[00:25:29]That's why I'm hungry for knowledge.

[00:25:31]It's also why I admit while why I admit when I'm wrong about things. I try to always question whether I am right about my opinion and I always try to play devil's advocate as well. And nobody really knows how any of this is going to go. We're just all out here doing our best. So, let's go back to Johan's piece here. And I'll scroll down to the next chart that he has about the point of control.

[00:26:07]He says that price is facing the same point of control and needs to find a way to get above it. If the most recent price action from 73 towards 76,000 bears any indicative information, the same pattern can return and price might teleport towards 73,000 where it will find the 200 day moving average as the final boss of the long-term downtrend.

[00:26:30]And that's what we've been talking about here. So, I'm going to click it on this chart here to show you. This is a great one. This is just showing you the market range. And I think this is a really interesting chart here because it shows you where the market basically in a very simple term where the market has been and what is the essentially the oscillation point of that range. So you can see here on a year-to-ate basis the Bitcoin price has been in this 70,000 area in terms of its midpoint 67 to 73 right now. Bitcoin trading very very close to it. So the the chart here is showing you that Bitcoin is doing its best on just a range basis to get back to this neutral zone.

[00:27:36]And this is obviously for shorts. This is a good time to come in and put your short on with a tight stop-loss. I'm not advocating for that in any way here. But from a purely technical strategic standpoint, you have to understand actually what the other side is going to do. The other side is going to love putting shorts on at 67. Love putting shorts on at 67. Put them with a nice tight stop-loss. That way, if it goes to 68, it's invalidated and the position is closed. There's a max loss for those shorts. And Bitcoin actually will get some upside momentum because a short covering is is what? It's a buy.

[00:28:22]It's a buy to close. So a buy to close sends the market higher etc. So these ranges and these points of control and these midpoints to recent ranges they are very important to know in terms of trader entry points and on the short side too. So, if you're buying up at 67, who are you buying from?

[00:28:48]You're buying from these shorts that are willing to come in and are probably more willing to come in with a short than you are willing to buy up there. And that's just the nature of a bare market getting up to a recent range. So, you know, the bottom line is is to be cautious when we get to these points. Now, let's progress to division.

[00:29:11]This is a highly highly technical options section. So I'm going to go through it. I want to show you the chart, but we'll try to summarize as best as we can and simplify things. One of the bullish forces on the trend composition, which is remember trend is on the x axis, valuation is on the y- axis. So scooting from that capitulation over to disbelief towards the middle there on the x axis.

[00:29:41]One of the bullishes, one of the bullish forces on the trend composition lately has been the overall derabit PCR.

[00:29:48]Dissecting the overall PCR into individual experies shows that the bullishness is exaggerated. Now this is the put call ratio. This is the ratio between puts and calls and the the total open interest there in the market in the in the options market specifically. So what are puts? What are calls? These are insurance contracts on price that exhibit either bullishness or bearishness. A put is a protection for for the downside and a call is exposure to the upside. So a high put call ratio is bearish because there are way more puts in the market than there are calls.

[00:30:29]A low put call ratio is bullish because it is essentially showing that the frequency of puts to calls is low. Now markets in terms of Bitcoin the average Johan says that the average is around 0.55 or essentially above 0.5.

[00:30:51]This historically 0.55 is neutral for Bitcoin position. This basically means that there's always a put bias in the market. Why you might ask? Well, it's it's purely behavioral guys. It comes down to the market is long, meaning that people are naturally long Bitcoin. And so the natural positioning in the options market is going to want to protect that. Such as, you know, the number of entities in the world that are selling fire insurance versus the number of people that are buying fire insurance. Well, every single home buyer that wants to protect their home is going to buy fire insurance. So that's maybe one way to think about the put call ratio. We've been using a lot of fire insurance analogies here uh at the Bitcoin layer for some reason when it comes to the options market, but it always is a good way. Options are insurance, especially the put option itself. So, that's something to remember. Uh being bullish on the orange coin is their default setting, of course, for the people that are naturally uh trying to buy some some puts. So, let's go to the put call ratios themselves. I'll click on Yan's chart here. And guys, there's so much information available to you. We're looking here at the put call ratios of MSTR, IBIT, Derabit. Now, and of course, the Bitcoin price here in white. Now, let me take the Bitcoin price off of here for just a quick second. And I'm going to hide the open interest as well.

[00:32:26]These are all tools that you can use when you're trying to toggle and get maximum information. Now I'm going to remove micro strategy MSTR here because we're first of all Johan didn't include that in his analysis and I want to remove that as I'm looking at and showing you guys here. All right, let's remove Micro Strategy here. And now you can see that the put call ratios of IBIT, which is the Bitcoin Black Rockck ETF, and the put call ratio of Darabit, which is a a Bitcoin native, essentially a native options exchange where the collateral is Bitcoin itself. You can see here that they don't behave the same way. So that by itself is interesting.

[00:33:19]I'm going to zoom out a little bit more so you and you can see the blue line is relatively new because that IBIT market did only start in the late stages of 2024.

[00:33:32]And that's of course because the ETFs themselves went live at the beginning of 2024 and it took time for the options market to get approved and developed.

[00:33:42]But now I'm going to remove the IBIT here because Johan has been talking about the put call ratios here for Darabit itself. But you can I I'm going to zoom in a little bit here because what we what we need to note is that the expiry that we're looking at is what matters here. So on the expiry basis, we want to make sure that we are looking at the various dates of expiry for these options markets. Now I'm going to deselect some of these out into 2027 here and even December. I'm going to deselect that one. And then we will zoom in a little bit here. Oh, let's do zoom in a little bit more. So now you can see how these different markets the put call ratios are trading over time and versus the different strikes I'm sorry the different experies now for options for options people this will make this will be an exciting tool for many of you this will be a little bit too complex and even for me here as an options options. I'm an options student more than an options trader. I'm here trying to learn from Johan and make the most sense and add charts to my own repertoire. And that's part of my intent here with you guys today is to show you the different tools that you have available. And I'm probably going to need my own tutorial with Johan to get even better at extracting signal here.

[00:35:26]So, I'm going to go down to the skew chart, and we're going to skip the skew chart because the skew chart is again another highly complex options topic.

[00:35:35]This one here on inflows. So, I'll read to you what he said. The Coinbase premium indicator has been on the rise lately and shows positive scores along with ETF uh flows. After two months of outflow, the ETFs have experienced a net inflow of capital gain again.

[00:35:54]So, let's look at the inflow. So, I'm going to click open this chart here, and this is our ETF tracker. Now, there's a few things that we can do to adjust this. So, I'm going to first of all zoom into about two. Let's go to one year here of price action.

[00:36:16]And then I'm gonna get rid of the flows on Bitcoin terms and just put them on dollar terms.

[00:36:26]And then the holdings also I'm going to put in dollar terms so that they follow a little bit more of the shape. And then I'm going to go to the 5day simple moving average of the flows. And that and that way I'm going to zoom in also a little bit here. And that way you can see a little bit more of what Johan is talking about. So you see all these red bars here. This is the outflows from these ETFs over you can see the trend really got going here in May.

[00:37:02]And for essentially two months all outflows from the ETFs those have turned around here in the last couple weeks or the last week or so. So, this is a great tool because this is able to show you what is going on in the in the ETF market. And the ETF market, why is that market important?

[00:37:28]It's important because it's a highly visible metric of broad investor interest, sentiment, and again demand.

[00:37:37]Because we talk about demand for Bitcoin. The demand for ETF shares is directly corresponding with the demand for Bitcoin, but it's expressed through a different a different metric. It's a different market. The market for IBIT, buyers and sellers, is different than the market for BTC, the underlying coin, the underlying digital asset that is native to the Bitcoin protocol that if you use a self-custody wallet of any type, you have to your wallet is using the Bitcoin protocol to take custody of that Bitcoin because that transaction that is written that goes to the address corresponding to your private key that is written into the Bitcoin blockchain.

[00:38:31]Therefore, the market for BTC itself is going to be representative in many ways of the demand for Bitcoin moving from wherever it is in a centralized environment, exchange environment, exchange wallets into your wallet. That is the demand for Bitcoin. But what is the demand for IBIT? And it's it's a different investor base. It's not those that want it in their wallet. It's those that want it in a Black Rockck instructed Coinbase custody wallet. It's a different segment of the market. But can we use that segment of the market to assess behavior?

[00:39:15]Absolutely, yes. And that's what we are trying to do here by showing you these different tools and these different metrics. So, a big shout out to Johan Bergman. I hope you guys are following him on social media and I definitely hope you guys are reading his spectacular Wednesday letters which I end up reading most times. You guys might know this on Thursday morning with my coffee because I do not I'm not the the gatekeeper for his pieces. So that Thursday coffee is uh one of my favorites of the week for sure. But today I read it right when it came out because I first of all I was anxious to know what he said. Very anxious to know what he said. I think his analysis is spectacular and I and I also want to get better. So part of my practice today was going through his post and then clicking on the charts and toggling things on and off and understanding the tools that he's using inside TBL Pulse. So again, to get free access to TBL Pulse, go to research.the bitcoinlayer.com.

[00:40:26]Start for free today. Look at our liquidity index which is available to you. Look at our macro tab. And then if you want to go deeper into the Bitcoin information that we have or even our model portfolio, uh there are options for you and we welcome you. We would love to have you on board. We're building great tools and in my opinion incredibly affordable ways to get top tier information and it it can it can go along with the opinion o of us as well.

[00:40:59]And I've been around Bitcoin for about 10 years now. So, I believe that of course, like I said, I have a bullish bias, but I've also seen the ups and downs in Bitcoin, and I've seen three essentially very deep and long bare markets uh in my tenure here. So, I can offer that perspective to you guys as well. Heading back to the rest of his article, I'm going to show you this was this was the chart that inspired me to want to bring the TBL pulse interactive experience to you guys today via our channel is the cost basis section because I didn't real I didn't actually realize that this is how to get this suite of information. I was trying to get other realized price or cost bases in other areas of tbl pulse within this incredible Bitcoin section. So that is in in short why I wanted to bring it to you today. The short-term holder cost basis and the rookie cost basis are closing on in on each other. And he has a quick reminder for what these are. The short-term holder cost basis is the 155day volume weighted moving average. The rookie cost basis is the cost basis of coins that have been acquired in a bull market and haven't moved since. So these are derivatives of the the realized price metric that we use which is looking at the onchain cost basis where coins were moving or sorry what the price was when coins were moving onchain. So the chart the chart shows the caution that I still have which I wrote about in the intro. Price is nearing the short-term holder cost basis again which acts as a resistance in bare markets and a support in bull markets.

[00:42:54]It's not an exact science but a reference point. So he explains that the in other bare markets the short-term cost bas short-term cost basis went below the rookie which could happen again but um I'll click on this here so you can see now this is I'll scroll up a little bit so you can see in the Bitcoin tab in the cohort subtab here we have realized price so you have rookie veteran short-term holder long-term holder realized and capitalized so I'm going to remove the ones that he wasn't writing about here. And so you can see that this short-term holder cost basis is approaching this rookie uh cost basis. And I will zoom in a little bit closer so you can see here where these numbers are going. And again, this is this rookie basis in red and the orange one is the short-term holder cost basis.

[00:43:49]I'm going to zoom way out so you can see when this has crossed in the past. This was in 2022, the depths of the bear.

[00:43:56]Johan is saying he thinks that this one might bottom out here towards this and might not cross below.

[00:44:04]I think that that's an interesting take and one that I want to continue to understand why he's talking about it.

[00:44:11]But this is a great one. And um for fun, let's throw on the realized cost basis.

[00:44:17]So you can see here it's his opinion that this one won't be tagged during this cycle um and that you know it in the past it's been a level that has been pierced and represented an incredible buying opportunity. So not reaching the realized price this cycle would be that would be as important as let's say Bitcoin not adhering to the 4year cycle itself because it would show you that Bitcoin is in a different more maturing state. a theme that I've talked about with the videos I've done with James Czech of Czech on chain for quite some time, you know, I think over well over a year that we James and I have talked about this, we have discussed the maturation of the Bitcoin market in terms of compressed volatility.

[00:45:15]And if this is the closest, if this is the closest that Bitcoin gets to the realized price during this current bare market cycle where Bitcoin was at 58 and realized was at 53, if this is the closest, it's it's actually enormous news. It's a and it it makes me so bullish that my brain is starting to hurt.

[00:45:43]But we have to temper our expectations.

[00:45:46]We have to and that's actually the thing about markets is that you go in when you are fearful that it's it could go lower because it's unlikely to go lower than your deepest fear levels or around that range. That's what makes it tough. But that's what br that's what brings out the experienced investors that know what they're buying. And in Bitcoin, I'll tell you, those that know what they're buying are are not very common in traditional finance. And you can see that with the comments that are coming out during these last few weeks even from I'll say established investors about Bitcoin. it it seems like they they simply don't understand why people bought it in the first place.

[00:46:36]So that I mean that's a that's a healthy sign for contrarians but for the populace in general it keeps people away and those are the times when then Bitcoin is available for low valuations and to the lower end of that state grid that we have on the yaxis in terms of its valuation.

[00:47:06]It's in the low percentile and that's because the interest itself is low. So, let's see how it plays out. Of course, that's what we do at the Bitcoin layer.

[00:47:16]We watch it, we analyze it, we research it, we try to come up with ideas also for you guys. And on top of the ideas, we have macro indicators, which you can see here. We have everything available to you guys. You guys can get a peak of what our indicator says. Two days ago, we gave a confirmed sell signal. I wrote a letter on Monday about how I felt with the sell signal going live essentially on the same day that Bitcoin is pumping.

[00:47:44]And the pump was small, but you know, so I go into my opinion there and balance this, you know, do we need to adjust our framework? Do we need to rethink it?

[00:47:55]Well, my conclusion was no. And I I wanted to explain my thoughts there. So maybe you guys will go check out my Monday letter and then you can see what the Bitcoin price is, the entry price.

[00:48:05]This gets into uh the Bitcoin metric that or the Bitcoin state grid that Johan has. So valuation 18, that means it's in the 18th percentile. And the reason that it's green is that it's cheap. So it's a good buy zone. Trend though negative 1.4, right? Because it was to the left side of the Y ais. That means on the X axis the trend is still negative here and some other metrics. So we hope you guys enjoyed this intense Bitcoin study here. Please do go check out research.the bitcoinlayer.com so you guys can get started. We want you to get started. We want you to see what we have there. And we're really proud of what we built and we want your feedback. We want to hear what you guys think we need to add or what you guys are using it for.

[00:48:58]I'll tell you something very honestly.

[00:49:00]We get messages all the time saying that TBL Pulse is the first place that people go to start their day and that makes us extremely happy. I have also for for long before it was TBL Pulse when we have our when we had our own little internal dashboard for TBL Pros, I was going to that every day so that I could get the latest numbers and and all of our latest information. But we've come a long way. We now have a search function here that you guys can search for what you're looking for, which is incredible. We have a new community tab and we also have our new TBL MCP server.

[00:49:40]So, make sure you guys connect your AI to TBL so you can get essentially access to our data. You can ask it to chart and analyze treasury auctions, economic data, Bitcoin onchain, anything that you that you saw today. You can even have it explain to you what's going on and how to come up with good ideas. So, you use your own agent, whether it's Claude or Chat GPT, and you connect our MCP server, which you can do here. Very easy to do. Click copy. We have the instructions with a little walk through here video that Augustine and Damian put together. So, very easy. We have an Ask TBL chatbot as well here that you can you can talk to us about what you're interested in. A ton of tools available.

[00:50:34]Please go check it out. research.the bitcoinlayer.com to get tbl pulse. I'm Nick Batia. Please subscribe to the channel if you liked what you saw here today or rate and review on your favorite audio platform.

[00:50:52]We are of course available at the bitcoin layer.substack.com.

[00:50:57]We would love to have you. We'll catch you guys next time.

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