{"id":117587,"date":"2025-05-20T17:14:09","date_gmt":"2025-05-20T17:14:09","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/117587\/"},"modified":"2025-05-20T17:14:09","modified_gmt":"2025-05-20T17:14:09","slug":"btc-withdrawal-cost-basis-signals-market-optimism","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/117587\/","title":{"rendered":"BTC Withdrawal Cost Basis Signals Market Optimism"},"content":{"rendered":"<p>Record highs \u2014 be it $20,000 in 2017, $69,000 in 2021 and $109,000 this year \u2014 are great for headlines and quick comparisons, but in reality don&#8217;t do a great job of describing price action.<\/p>\n<p>Tracking the &#8220;realized price,&#8221; or the average price at which bitcoin <\/p>\n<p> is withdrawn from all exchanges to estimate a market-wide cost basis is a more valuable tool for gauging investor profitability and potential inflection points in market sentiment.<\/p>\n<p>The charts (above and below) illustrate the average withdrawal prices for different investor cohorts, segmented by the year they entered the market starting Jan. 1 of each year from 2017 to 2025. <\/p>\n<p>The average realized price for the 2025 so far is $93,266. With bitcoin currently trading at $105,000, these investors are up approximately 12% on average.<\/p>\n<p>When bitcoin began its decline from the all-time high of $109,000 in late January, it briefly fell below the 2025 realized price, a historical signal of capitulation. This period of stress lasted until April 22, when the price reclaimed the cohort\u2019s cost basis.<\/p>\n<p>Historical Context: Capitulation Patterns<\/p>\n<p>Historically, when price falls below a cohort\u2019s realized price, it often marks market capitulation and cyclical bottoms:<\/p>\n<ul class=\"unordered-list\">\n<li><strong>2024:<\/strong> After the ETF launch in January, bitcoin dipped below the average cost basis before rebounding. A more significant capitulation followed in the summer, linked to the yen carry trade unwind when bitcoin plunged to $49,000. <\/li>\n<li><strong>2023:<\/strong> Price tracked close to the average cost basis during support levels, only briefly breaking below during the Silicon Valley Bank crisis in March.<\/li>\n<\/ul>\n<p>The data suggests that a capitulation phase has likely occurred, positioning the market for a more constructive phase. Historically, recoveries from such events mark transitions into healthier market conditions.<\/p>\n<p><img alt=\"BTC: Exchange Average Withdrawal Price (by year) (Glassnode)\" loading=\"lazy\" width=\"3200\" height=\"1800\" decoding=\"async\" data-nimg=\"1\" class=\"rounded-md\" style=\"color:transparent;background-size:cover;background-position:50% 50%;background-repeat:no-repeat;background-image:url(&quot;data:image\/png;base64,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&quot;)\"  src=\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2025\/05\/1747761249_647_image\"\/><\/p>\n<p>BTC: Exchange Average Withdrawal Price (by year) (Glassnode) <\/p>\n<p>Realized, not record<\/p>\n<p>When bitcoin first surpassed $20,000 during the 2017 bull market, it marked a significant divergence between the market price and the realized price of just $5,149, highlighting a phase of exuberant speculation. Unsurprisingly, prices very shortly after went into a brutal reversal.<\/p>\n<p>In contrast, by the depths of the 2018 bear market when bitcoin bottomed around $3,200, price at that point converged with the all-time realized price, a metric that aggregates the cost basis of all investors across cycles.<\/p>\n<p>This long-term cost basis acts as a foundational support level in bear markets and gradually rises over time as new capital enters the market. Therefore, evaluating bitcoin solely by comparing cycle peaks, for example, from $69,000 in 2021 to just over $100,000 in 2025, misses the bigger picture.<\/p>\n<p>The more relevant insight is that the aggregate cost basis of all investors continues to climb, underscoring the long-term maturation of the asset and the increasing depth of capital committed to the network.<\/p>\n","protected":false},"excerpt":{"rendered":"Record highs \u2014 be it $20,000 in 2017, $69,000 in 2021 and $109,000 this year \u2014 are great&hellip;\n","protected":false},"author":2,"featured_media":117588,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3091],"tags":[2257,51,24556,49553,2441,16,15],"class_list":{"0":"post-117587","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-bitcoin","9":"tag-business","10":"tag-exchange","11":"tag-market-analysis","12":"tag-markets","13":"tag-uk","14":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114541288746434318","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/117587","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=117587"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/117587\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/117588"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=117587"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=117587"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=117587"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}