## Understanding MVRV: A Crucial Bitcoin Metric

**MVRV** (Market Value to Realized Value) is an essential metric that provides insights into the valuation of Bitcoin. It is computed by dividing the market capitalization of Bitcoin by its realized capitalization. This metric helps investors gauge whether Bitcoin is overvalued or undervalued in the market.

### What Does MVRV Indicate?

- A **MVRV ratio** above 1 suggests that Bitcoin is currently overvalued, while a ratio below 1 indicates it is undervalued. 
- This metric can serve as a useful tool for determining potential price corrections or surges, aiding investors in making informed decisions.

### Historical Context

Historically, MVRV has shown significant predictive power regarding market cycles. For instance, during bullish phases, MVRV tends to rise, while in bearish phases, it often drops, indicating a potential buying opportunity for savvy investors.

### Using MVRV in Investment Strategies

Investors can utilize MVRV to:
- Identify potential **buying opportunities** during periods of undervaluation.
- Assess market sentiment by analyzing shifts in the MVRV ratio.
- Make strategic decisions about when to enter or exit positions in Bitcoin.

By keeping an eye on MVRV, investors can better navigate the volatile landscape of cryptocurrency and enhance their investment strategies.

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Unlocking the Secrets of MVRV: A Key Bitcoin Metric for Investors

### VIX's Second-Largest Spike in History Indicates a Local Bottom for Bitcoin: Van Straten

The **VIX** jumped **74%** yesterday following a **25 basis point Fed rate cut** and a hawkish outlook from **Fed Chair Jerome Powell**. This significant market movement has sparked discussions about potential implications for **Bitcoin (BTC)**.

On **December 18**, the market was shaken as Bitcoin briefly fell below **$100,000**, while U.S. equities dropped around **3%**. The **dollar index (DXY)** soared to a two-year high of **108**, exerting pressure on global currencies.

The **CBOE Volatility Index (VIX)**, often referred to as Wall Street's fear gauge, experienced its largest one-day jump since **February 5, 2018**, marking the **second-largest increase** in its history. Historically, substantial spikes in the VIX have indicated local bottoms for both Bitcoin and the **S&P 500**.

Examining the top three one-day changes in the VIX:
- The first occurred on **February 5, 2018**, when it surged by **116%**. On that day, Bitcoin dropped **16%** to **$6,891**, marking a local bottom, which later rebounded to over **$11,000** by **February 20**.
- The second-largest spike happened on **December 18**, with a **74%** increase.
- The third spike occurred on **August 5, 2024**, when the VIX increased by **65%**. During that time, Bitcoin fell **6%** to around **$54,000**, eventually climbing back to over **$64,000** by **August 23**.

A similar pattern has been observed in the **S&P 500** over the years, as evidenced by data shared by **Charlie Bilello**, chief market strategist at Creative Planning.

At the time of this writing, Bitcoin is trading above **$102,000**, while S&P 500 futures indicate a **0.37%** gain, suggesting potential recovery as history may repeat itself.

![Charlie Bilello - VIX](https://www.coindesk.com/_next/image?url=https%3A%2F%2Fcdn.sanity.io%2Fimages%2Fs3y3vcno%2Fproduction%2Fc5c391318f6820ee58aca8cb072233bf41b5f3e3-599x503.png%3Fauto%3Dformat&w=640&q=75&dpl=dpl_5WfNcvLw7N5k9AZk3ygLu9fmruzk)

*Image Credit: Charlie Bilello*

The VIX jumped 74% yesterday after a 25bps rate cut and a hawkish outlook from Fed Chair Jerome Powell. 

Is Bitcoin Set for a Recovery? VIX's Historic Surge Suggests a Local Bottom

### Hut 8 Makes a Significant Bitcoin Purchase

Hut 8 (HUT), a prominent Bitcoin miner based in Miami, Florida, has made waves in the cryptocurrency market by purchasing **approximately 990 Bitcoin** at an **average price of $101,710** each. This strategic buy increases their total Bitcoin holdings to **10,096 BTC**, valued at around **$1 billion**, positioning Hut 8 among the **top 10 corporate holders** of Bitcoin.

### Strategic Plans for Bitcoin Reserves

The company plans to leverage its growing Bitcoin reserve through various strategies, including options trading and sales. CEO **Asher Genoot** emphasized the importance of this reserve, stating, "Today, the market recognizes and values our strategic reserve, which effectively lowers our cost of capital and strengthens our financial position."

### Following Industry Trends

Hut 8's recent purchase aligns with a trend started by **MicroStrategy**, the largest corporate holder of Bitcoin, and followed by **MARA Holdings**. Notably, **Riot Platforms** has also recently acquired Bitcoin, indicating a broader move within the mining sector to bolster holdings in the face of market changes.

### Financial Growth and Market Response

The decision to buy Bitcoin comes at a time when many miners are navigating profit challenges following the latest Bitcoin halving event. Hut 8's stock has seen a substantial **74% increase this year**, reflecting investor confidence as the company also engages in significant operational expansions aimed at achieving **24 EH/s** of self-mining capacity by Q2 2025. 

Hut 8 sees its Bitcoin reserve as a **dynamic financial asset**, which can be actively managed to enhance returns beyond mere price appreciation. This holistic approach to Bitcoin investment positions Hut 8 for continued growth and adaptability in the ever-evolving cryptocurrency landscape.

The miner bought about 968 bitcoin for average price of around $101,710 each.

Hut 8's Bold Move: $100 Million Bitcoin Acquisition Boosts Holdings to $1 Billion

If you had invested **$6,000** in the world's largest cryptocurrency, **Bitcoin**, roughly a decade ago, you'd be a millionaire today. Bitcoin and the crypto sector have not just survived, but **thrived**, with the token recently surpassing **$107,000**. 

Several other cryptocurrencies have also performed well, achieving market caps exceeding **$100 billion**. One of them is **XRP**, which currently boasts the fourth-largest market cap in the crypto sector at more than **$140 billion**. If you had invested in XRP a decade ago, there’s a chance you might be a millionaire today. But what about now? Can XRP make you a millionaire from current levels?

## What is XRP?

**XRP** was developed in **2011** by four software engineers: **David Schwartz**, **Jed McCaleb**, **Arthur Britto**, and **Christian Larsen**, and is managed by **Ripple**, led by CEO **Brad Garlinghouse**. The primary purpose of XRP was to address inefficiencies in Bitcoin, particularly its **energy-intensive mining system**. While many cryptocurrencies aim to facilitate **digital payments**, XRP was specifically designed for more efficient **cross-border transfers**. The **XRP ledger** can settle transactions in just **3 to 5 seconds**, handle **1,500 transactions per second**, and has lower transaction costs than Bitcoin, making it more environmentally sustainable.

![XRP Price Chart](https://media.ycharts.com/charts/88858bbf602bfeb4635e9ee98f3a8854.png)

These features have attracted nearly **20 financial institutions** to work with Ripple, and recently, Ripple launched a **U.S. dollar stablecoin** called **RLUSD**. This stablecoin aims to leverage the characteristics of a digital asset while minimizing volatility, requiring XRP tokens for transaction fees.

## Legal Roadblocks Likely to Clear

In **2020**, the **Securities and Exchange Commission (SEC)** sued Ripple for conducting an unregistered sale of securities through XRP. The outcome of this case is crucial as it could impact regulatory jurisdiction over many cryptocurrencies. Proponents argue that cryptocurrencies should be treated as currencies under the **Commodity Futures Trading Commission (CFTC)**, not the SEC.

Fortunately, a federal judge ruled in favor of Ripple last year, although the SEC has appealed parts of that decision. With the impending change in administration, many believe that a pro-crypto environment could lead to favorable regulatory conditions for XRP.

## Is XRP a Millionaire Maker?

Investing in XRP now with a goal to become a millionaire would require an initial investment of **$10,000** to grow into **$1 million** over the next **20 years**. This would necessitate a total return of **9,900%** or a compound annual growth rate of **25.9%**.

However, it’s essential to remember that **$1 million** in **20 years** will not have the same purchasing power as it does today. Moreover, XRP faces competition from other cryptocurrencies like **Solana**, which claims to process **65,000 transactions per second**, although it hasn't reached this speed yet.

While XRP has the potential to be a millionaire maker, speculating on long-term price targets for volatile cryptocurrencies can be futile. I believe XRP will continue to rise alongside Bitcoin, but it may only warrant a small speculative investment at this stage.

If you had invested $6,000 in the world's largest cryptocurrency Bitcoin roughly a decade ago, you'd be a millionaire today. Bitcoin and the crypto sector have overcome all odds not just to survive, but to thrive. The token recently surpassed $107,000. Several other cryptocurrencies have done well and grown to market caps exceeding $100 billion. One is XRP (XRP -6.74%), which currently has the fourth-largest market cap in the crypto sector at more than $140 billion. If you invested in XRP a decade ago, there is a chance you're a millionaire today. But how about now? Can XRP make you a millionaire from current levels?

Can XRP Transform Your Investment into Millions? Discover the Potential!

The year **2024** has ushered in a **significant breakthrough** for digital assets, particularly for **bitcoin (BTC)**, driven by increased **institutional adoption**. This shift has occurred through two key avenues:

1. The integration of bitcoin into **public balance sheets** as a treasury asset.
2. The success of **U.S. spot-listed exchange-traded funds (ETFs)** that have amassed over **1 million BTC**.

### Bitcoin ETFs vs Gold ETFs
A report from [K33 Research](https://108.181.11.137/i0qyt2j9snzb/1elNlF9J3uPNQXHNVV7Jr7/e6ecaaa0531ede4ab5fb0b7b975c6115/Ahead_of_the_curve_-_December_17_2024.pdf) reveals that U.S.-listed bitcoin ETFs have surpassed U.S.-listed gold ETFs in terms of **assets under management (AUM)**, including leveraged products such as **futures-based ETFs**. As of **Dec. 17**, Bitcoin ETFs reached AUM worth **$129.25 billion**, edging out Gold ETF AUM at **$128.88 billion**, according to [Vetle Lunde](https://108.181.11.137/VetleLunde/status/1868945665235308620), analyst at K33 Research.

However, when comparing **spot-based products** exclusively, Gold remains slightly ahead. According to Senior Bloomberg ETF Analyst [Eric Balchunas](https://108.181.11.137/EricBalchunas/status/1869032761207742717), U.S. bitcoin spot ETFs hold **$120 billion** in AUM compared to **$125 billion** for Gold ETFs.

### CME Activity and Market Momentum
The **CME exchange**, primarily used by institutions, continues to demonstrate strong activity, with **futures open interest** approaching new highs, reaching **212,635 BTC** in open interest contracts. The report notes that the **basis trade premium** has continued to rise, reaching **16.4%** — the highest level since **November 2023**. This indicates that CME traders anticipate increased momentum as the year comes to a close.

The report further highlights:
- **January contracts** are trading at sharp premiums relative to December contracts, with the contango widening to **1.5%** on Monday — the highest next-month premium recorded since **November 2023**.
- The December contract on CME remains the most valuable, with open interest equivalent to **113,480 BTC**. 

The momentum has continued for the past month, as the U.S. spot-listed bitcoin ETFs have seen **net inflows every day** since **Nov. 27**, totaling **$6.5 billion**, according to [Farside](https://108.181.11.137/bitcoin-etf-flow-all-data/?__cpo=aHR0cHM6Ly9mYXJzaWRlLmNvLnVr) data. A large portion of these net inflows are part of the **cash and carry trade** as the basis trade premium continues to widen and with a growing amount of open interest contracts on the CME.

**Disclaimer:** This article, or parts of it, was generated with assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to [our standards](https://108.181.11.137/ethics?__cpo=aHR0cHM6Ly93d3cuY29pbmRlc2suY29t). For more information, see [CoinDesk’s full AI Policy](https://108.181.11.137/coindesk-news/2023/04/14/how-coindesk-will-use-generative-ai-tools?__cpo=aHR0cHM6Ly93d3cuY29pbmRlc2suY29t).

U.S. spot-listed bitcoin ETFs currently have an AUM of $120 billion compared to gold's $125 billion. 

Bitcoin ETFs on Track to Overtake Gold ETFs: A New Era for Digital Assets

## The Heated Debate Between Peter Schiff and Michael Saylor

Financial market commentator **Peter Schiff** recently took aim at **Michael Saylor**'s comparison of **MicroStrategy Inc.**'s (NASDAQ: MSTR) debt-fueled Bitcoin (CRYPTO: BTC) purchasing strategy with Manhattan real estate. Schiff expressed his disagreement through a post on X, emphasizing that **real estate generates rents**, which can be utilized to service and repay debt, while **Bitcoin does not generate any income** for interest or principal payments.

## Schiff's Argument

In his critique, Schiff stated, "Real estate generates rents, which can be used to service and repay debt. Bitcoin doesn’t generate any income to make interest or principal payments.” His argument underscores the fundamental difference between the two asset classes — real estate has the potential for cash flow, while Bitcoin does not.

## Counterpoint from Spencer Hakimian

**Spencer Hakimian**, founder of **Tolou Capital Management**, countered Schiff’s viewpoint by highlighting that unlike the Manhattan real estate market, **Bitcoin incurs no expenses or maintenance costs**. Schiff rebutted this claim by noting that rents from real estate often exceed the associated expenses.

## Current Real Estate Trends

The ongoing rental market in New York City stands in stark contrast to national trends, with the top 50 markets experiencing a decline in rents for 15 consecutive months. As of October 2024, the **median asking rent** in New York increased by 1.7% year-on-year to **$3,374**, reflecting a **13.1% surge from pre-pandemic levels**. Meanwhile, Manhattan's median monthly rent reached **$4,750**.

## Why This Discussion Matters

This exchange comes in the wake of Saylor defending MicroStrategy’s Bitcoin purchasing strategy by likening it to the **Manhattan real estate** sector. Saylor argued that just as developers in Manhattan issue more debt to fund new developments when property values rise, MicroStrategy aims to leverage high returns from Bitcoin to expand its holdings.

This ongoing debate highlights the contrasting perspectives on asset valuation and income generation between traditional real estate and cryptocurrency, particularly Bitcoin.

Financial market commentator Peter Schiff on Tuesday criticized Michael Saylor’s comparison of MicroStrategy Inc.‘s (NASDAQ:MSTR) debt-financed Bitcoin (CRYPTO: BTC) buying strategy to Manhattan real estate. What Happened: In an X post, Schiff disagreed with Saylor’s analogy. “Real estate generates rents, which can be used to service and repay debt. Bitcoin doesn’t generate any income to make interest or principal payments,” he argued. It's wrong for @saylor to compare his leveraged buying of #B

Peter Schiff Slams Michael Saylor's Bitcoin vs. Manhattan Real Estate Analogy: The Income Debate

### El Salvador's Historic Agreement with the IMF

**El Salvador** has reached a significant agreement with the **International Monetary Fund (IMF)** after **four years of negotiations**, which were complicated by the nation's decision to adopt **Bitcoin as legal tender**. This deal includes a **$1.4 billion loan program** that will be distributed over **40 months**.

### Key Terms of the Agreement

In exchange for the loan, El Salvador has committed to implement measures aimed at improving its **primary balance** and reducing its **debt-to-GDP ratio**. The IMF has acknowledged the government's efforts in enhancing its **fiscal situation**, fostering economic growth, lowering **inflation**, and managing **short-term debt obligations**.

### Challenges from Bitcoin Adoption

The adoption of Bitcoin in 2021 by President **Nayib Bukele** initially created friction with the IMF, leading to **credit downgrades** and investor concerns. This new agreement could potentially resolve long-standing issues affecting investors in El Salvador's bond markets, pending approval from the Fund's executive board.

### Changes to Bitcoin Policy

Notably, the agreement includes concessions regarding **Bitcoin**. Legal reforms will ensure that the acceptance of cryptocurrency is **voluntary** for the private sector, significantly reducing the risks associated with the country's Bitcoin initiative, according to the IMF. Additionally, the government's involvement with the **Chivo** cryptocurrency wallet, which has faced numerous technical challenges, will be **gradually unwound**.

### Chivo Wallet Insights

Launched in September 2021, **Chivo** offered users **$30 worth of free Bitcoin** for signing up, attracting over **3 million sign-ups**. However, actual usage remained low, with reports indicating that less than **2%** of remittances were processed through digital wallets in 2022.

### Financial Recovery Efforts

President Bukele has made strides in recovering from the initial backlash by **buying back dollar notes** at a discount, paying off bonds early, and restructuring pension debt. As a result, bonds due in **2052** have seen a significant rise in value, rewarding investors with one of the highest returns in the developing world.

### Market Response

Following the announcement of the loan agreement, bond trading experienced mixed reactions. El Salvador's government made a surprising return to the bond market in April, successfully selling **$1 billion** in global notes with conditions tied to credit-rating improvements and the IMF deal.

(Bloomberg) -- El Salvador reached a deal with the International Monetary Fund after four years of negotiations that were strained by the country’s adoption of Bitcoin as a legal tender. Most Read from BloombergNYPD Car Chases Are Becoming More Frequent — and More DangerousThe Central American nation and the Washington-based lender agreed on a $1.4 billion loan program to be disbursed over 40 months, according to a statement by the IMF. In exchange, El Salvador had agreed to adopt measures that

El Salvador Secures $1.4 Billion IMF Loan Amid Bitcoin Controversy

### Tesla's Position in the Bitcoin Landscape

In a recent analysis, we explored **10 Companies Hoarding Bitcoin Like There’s No Tomorrow**, with a spotlight on **Tesla, Inc. (NASDAQ:TSLA)**. As cryptocurrency values soar, understanding Tesla's role amidst its peers is crucial.

### The Bitcoin Surge

Since the start of the year, **cryptocurrencies** have experienced remarkable growth. After a minor dip in January, **Bitcoin** has surged over **141% year-to-date**, peaking at over **$108K** before stabilizing around **$107K**. The **pro-crypto** stance of President-elect **Donald Trump** has also influenced this price increase, particularly following his suggestion for a **national Bitcoin stockpile**.

### Political Influence on Bitcoin

At the **Bitcoin MENA 2024 conference** in Abu Dhabi, **Eric Trump** highlighted his family's commitment to cryptocurrency, asserting that the upcoming presidency will be historically **pro-crypto**.

### Bitcoin as a Reserve Asset

As Bitcoin is increasingly viewed as a **reserve asset** for governments and central banks, its adoption is accelerating. Institutions and corporations are pivotal in this transformation, with traditional financial entities collaborating with established crypto firms to enhance market dynamics.

### Insights from Industry Leaders

In a recent **CNBC interview**, **Alessio Quaglini**, CEO of **Hex Trust**, discussed the forthcoming phase of Bitcoin adoption, predicting a shift where governments will actively purchase Bitcoin. This change, once considered improbable, is now on the horizon as some governments already hold crypto assets due to regulatory actions.

### Competition and Collaboration

Quaglini noted the rising competition in the crypto sector, particularly from traditional finance, emphasizing a trend towards **collaboration** with digital asset firms. This approach is beneficial for both sectors, allowing for enhanced crypto services.

### Future Projections for Bitcoin

Looking towards **2025**, Quaglini anticipates a **structural shift** in Bitcoin's supply and demand, projecting a **5-10% quarterly appreciation**. Key catalysts for this growth include ongoing **institutional adoption**, with companies like **MicroStrategy** continuing their Bitcoin acquisitions. The addition of such companies to the **Nasdaq-100** is expected to further integrate Bitcoin into mainstream finance, paving the way for broader acceptance of digital assets in corporate portfolios.

We recently published a list of 10 Companies Hoarding Bitcoin Like There’s No Tomorrow. In this article, we are going to take a look at where Tesla, Inc. (NASDAQ:TSLA) stands against other companies hoarding bitcoin like there’s no tomorrow. Cryptocurrencies have been surging since the beginning of the year. After a small drop in January, […]

Unlocking the Secrets of MVRV: A Key Bitcoin Metric for Investors

Summary:

Understanding MVRV: A Crucial Bitcoin Metric

What Does MVRV Indicate?

Historical Context

Using MVRV in Investment Strategies

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Other Latest News

Is Bitcoin Set for a Recovery? VIX's Historic Surge Suggests a Local Bottom

Hut 8's Bold Move: $100 Million Bitcoin Acquisition Boosts Holdings to $1 Billion

Can XRP Transform Your Investment into Millions? Discover the Potential!

Bitcoin ETFs on Track to Overtake Gold ETFs: A New Era for Digital Assets

Peter Schiff Slams Michael Saylor's Bitcoin vs. Manhattan Real Estate Analogy: The Income Debate

El Salvador Secures $1.4 Billion IMF Loan Amid Bitcoin Controversy

Is Tesla Leading the Charge? Companies Hoarding Bitcoin Like There's No Tomorrow!

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Can XRP Transform Your Investment into Millions? Discover the Potential!

Bitcoin ETFs on Track to Overtake Gold ETFs: A New Era for Digital Assets

Peter Schiff Slams Michael Saylor's Bitcoin vs. Manhattan Real Estate Analogy: The Income Debate

El Salvador Secures $1.4 Billion IMF Loan Amid Bitcoin Controversy

Is Tesla Leading the Charge? Companies Hoarding Bitcoin Like There's No Tomorrow!