Bitcoin NVT indicator now signals undervaluation: moving from deep undervaluation to valuation reset

【Crypto】On-chain analysis firm CryptoQuant researcher MorenoDV_ recently pointed out that Bitcoin’s valuation reset cycle is underway.

The key indicator to watch is the NVT Golden Cross (smoothed by the 100-day moving average). Simply put, NVT links Bitcoin’s network value with trading activity, similar to the P/E ratio in stocks, but here on-chain transaction volume replaces corporate earnings. It helps us determine: Is Bitcoin’s market capitalization truly aligned with on-chain economic activity?

Current data is quite interesting. Short-term NVT is well below the long-term average, indicating that Bitcoin is trading at a discount relative to actual on-chain activity. This phenomenon has occurred multiple times in history, each time signaling the same message: market sentiment is冷淡, and the network is overall undervalued.

The cycle’s low point previously touched -0.58, and has now rebounded to around -0.32. What does this recovery indicate? Prices are gradually aligning with the fundamentals driven by on-chain transactions. Although still at a relatively conservative valuation level, the direction is clear.

Historical experience shows that whenever such deep deviations occur in the indicator, the market typically enters an accumulation phase after deleveraging and risk aversion. Then it slowly moves toward more rational price discovery. The market is now shifting from severe undervaluation toward equilibrium, with selective capital inflows increasing, which may indicate that the crypto market is undergoing structural improvements, and long-term opportunities are being laid out.