Grayscale published a report on May 9 (local time) concluding that Bitcoin has entered an undervalued zone based on on-chain metric analysis. Zach Pandl, Head of Research at Grayscale, stated in the report titled 'Is Bitcoin Cheap Yet?' that Bitcoin can currently be considered 'cheap.' The assessment reflects Grayscale's evaluation of Bitcoin's market positioning amid ongoing price volatility in the digital asset sector.
Grayscale Analyzes Bitcoin Valuation Using On-Chain Metrics
The report comprehensively reviewed key on-chain indicators including Bitcoin's Realized Price, Market Value to Realized Value (MVRV) ratio, and long-term holder behavior. Zach Pandl, who previously served as Chief Macro Strategist at Grayscale and currently oversees the research division, authored the analysis. The report was published on Grayscale's website on May 9 (local time).
Source: Glassnode, Grayscale Investments
Report Compares Current Undervaluation to Past Market Lows
The report noted that while Bitcoin appears undervalued, current levels do not reach the extreme undervaluation seen during the 2022 FTX collapse or past major bear markets. Grayscale's analysis distinguished between moderate undervaluation and the severe dislocations observed during prior market crises.
Grayscale Highlights Market Stability Conditions and Short-Term Risks
The report stated that if selling pressure from long-term investors eases and new investor entry expands, the market can form a more stable bottom. Grayscale added that short-term volatility may continue depending on investor sentiment and capital inflow conditions. The report emphasized that while on-chain indicators show bottom signals, further confirmation of overall market supply-demand improvement is necessary.
FAQ
What did Grayscale conclude about Bitcoin's valuation on May 9?
Grayscale concluded in a report published on May 9 (local time) that Bitcoin is currently in an undervalued state based on on-chain metric analysis, though not at the extreme lows seen during the 2022 FTX collapse or past bear markets.
What factors does Grayscale identify for potential market stabilization?
Grayscale's report stated that easing selling pressure from long-term holders and expanding entry of new investors could enable the market to form a more stable bottom, while noting that short-term volatility may persist based on sentiment and capital inflows.
