Bitcoin 2024 Year 11: On-Chain Data Signals Confirm Market Bottom Has Formed

The Bitcoin market has recently experienced clear signs of recovery in the first months of 2025. But the most notable thing is not the current price ($96.99K), but the evidence found deep within blockchain data – indicating that the world’s largest coin may have established an important market bottom in November 2024.

What Is the “Forgotten” Indicator Telling Us?

The Short-term Holder Profit/Loss Ratio (Short-term Holder Profit/Loss Ratio) – monitored by analysis firm Glassnode – is a figure rarely mentioned, but carries immense significance.

To understand better: this indicator measures the unrealized profit/loss status of Bitcoin addresses holding coins for less than 155 days. In other words, it reflects the “pain” level of new investors who have recently entered the market.

When this ratio hits an extremely low level (near 0), it means this group of investors is biting the bullet and taking significant losses – a signal that history shows often appears before strong recoveries.

History Repeats: Previous Bitcoin Bottoms

Bitcoin has gone through 4 major bear cycles since 2009, and each time, this indicator recorded critical levels:

• 2011: Ratio dropped to 0.015 → Bitcoin rose from $2 to $1,100
• 2015: Ratio reached 0.018 → Bitcoin increased from $200 to $20,000
• 2018: Ratio hit 0.020 → Bitcoin climbed from $3,200 to $69,000
• 2022: Ratio fell to 0.025 → Bitcoin rose from $16,000 to recent highs

But an unusual event occurred last November: the ratio only reached 0.013 – the lowest in Bitcoin’s 15-year history. This figure suggests that the sell-off storm may have ended.

Current Situation: Recovery but Not “Strong”

From the 0.013 level in November, this ratio has now recovered to 0.45 by March 2025. This is a significant improvement, but still far from the 1.0 threshold – which experts consider an official sign of entering a bull market.

This means: the market may have escaped panic sentiment, but has not yet entered the “frenzy” phase of a true bull run.

Factors Supporting the Recovery

As of (March 2025), Bitcoin is supported by several factors:

ETF Capital Flows: Physical Bitcoin management products continue to absorb strong capital. This is money from institutional investors – those likely to hold long-term positions.

Record High Hash Rate: Bitcoin mining power reaches all-time highs, indicating miners still believe in long-term prospects.

Growing Active Addresses: The number of actual Bitcoin users continues to increase, albeit slowly but steadily.

Decreasing Exchange Reserves: Bitcoin stored on exchanges is declining, meaning investors are “bringing coins home” – a sign they want to hold long-term.

When these factors converge, they paint a sufficiently optimistic picture for investors.

What Do Experts Say?

Jameson Lopp – CTO (Chief Technology Officer / Technology Management of Casa, a well-known Bitcoin security company – comments: “On-chain data provides valuable insights, but must be combined with macroeconomic context and regulatory changes. Currently, many positive signals are emerging simultaneously.”

Lex Sokolin, former global head of Fintech at ConsenSys, adds: “The wave of institutional acceptance through professionally managed products has changed the mechanics of the Bitcoin market. Traditional technical indicators now interact with new capital flows, creating a market structure that is both complex and potentially more stable.”

But Caution Is Still Needed

Despite positive signals, there are risks to watch out for:

• Regulatory Developments: Changes in policies in major economies can significantly impact market sentiment.
• Macroeconomic Conditions: Interest rate policies, inflation, or economic shocks can alter Bitcoin valuation.
• Technological Competition: Advances from other blockchains may affect Bitcoin’s position.
• Past Performance Is Not Guarantee of Future: Each market cycle has its own characteristics, depending on acceptance levels, technological maturity, and regulatory environment at each point.

Conclusion

On-chain data strongly supports the hypothesis that Bitcoin established its market bottom in November 2024. When combined with the Short-term Holder Profit/Loss Ratio, improving fundamentals, and increasing institutional capital flows, the outlook for Bitcoin until the end of 2025 becomes more optimistic.

However, smart investors should maintain a balanced view – not overly optimistic, nor overly skeptical – as the crypto market is still maturing and the macroeconomic environment remains full of variables.

Frequently Asked Questions

Q: What is the Short-term Holder Profit/Loss Ratio?

This is an on-chain indicator measuring unrealized profit/loss of Bitcoin addresses holding coins for less than 155 days. It shows whether recent new entrants are making or losing money – a direct reflection of market sentiment.

Q: Why is the 0.013 level in November significant?

Because it was the lowest level this indicator has recorded in Bitcoin’s 15-year history. History shows such extreme lows often appear at major market bottoms before strong rallies.

Q: How does this differ from traditional technical analysis based on price?

Traditional technical analysis relies on price charts on exchanges, while this indicator is derived directly from blockchain data – reflecting actual investor behavior rather than speculation or immediate sentiment.

Q: What other indicators should I watch?

No single indicator is sufficient for investment decisions. Combine: exchange reserves, active address count, hash rate, ETF capital flows, along with macroeconomic and regulatory conditions.

Q: Does this indicator guarantee Bitcoin will enter a bull market?

No. No indicator can guarantee that. Historical data shows a strong correlation, but each cycle has unique factors. Current signals suggest conditions have improved, but caution and continuous observation are essential.