Do On-Chain Metrics Signal the End of Bitcoin’s Bull Run?

Bitcoin has entered a phase of heightened volatility as multiple on-chain indicators signal potential turbulence. Despite the leading cryptocurrency’s recent record highs, data from CryptoQuant suggests the market may be approaching a critical inflection point rather than an overheated peak. These indicators, including the Net Unrealized Profit/Loss (NUPL), Market Cap to Realized Value (MVRV) ratio, Inter-Exchange Flow Pulse (IFP), and the Bull-Bear Market Cycle indicator, suggest a shift in sentiment and market conditions.

Do 4 different cyclical on-chain indicators signal the end of the Bitcoin bull run?

"All of these indicators suggest that Bitcoin has experienced significant volatility in the short to medium term.

However, none of them suggest that Bitcoin has reached an overheated or cyclical peak... pic.twitter.com/ tPw74wqERy

— CryptoQuant.com (@cryptoquant_com) March 25, 2025

The NUPL indicator, which measures the proportion of market participants taking profits, has gradually declined from previous highs. Historically, high NUPL values ​​have indicated market euphoria and a possible top, while a sharp drop into negative territory has indicated market capitulation. Currently, the indicator is hovering around 0.4, a zone that has historically signaled a market correction but does not indicate an immediate downturn. If NUPL fails to maintain current levels, it could indicate that investor risk aversion is increasing.

The MVRV ratio, which compares Bitcoin's market value to its actual value, is also showing signs of slowing down. Currently at around 1.9, the indicator is well below previous cycle highs 3.5 above the euphoria level. This suggests that while Bitcoin may be experiencing a local price peak, it has not yet reached the extreme overvaluation levels that typically signal the final climax of a bull market. Nonetheless, any further sharp rise in MVRV could indicate an over-intensification of speculation and a possible pullback.

IFP and Cycle Indicators Foreshadow Market Shifts

The IFP indicator, which tracks the net flow of Bitcoin between exchanges, also provides important insights. Recent data shows an increase in inflows to exchanges, which is typically associated with selling pressure. Historically, periods of higher IFP values ​​have coincided with market corrections as traders move assets to exchanges to take profits. While IFP It has not yet reached extreme levels, but the continued rise could indicate an impending sell-off phase, especially if big players begin to reduce their positions.

The Bull-Bear Market Cycle Indicator combines various on-chain and market sentiment indicators to present a more complex picture. While it has entered an early bullish phase, it has not yet reached the overheated region of the previous cycle top. This suggests that Bitcoin is still in a bullish structure, but is at risk of a temporary pullback. Historically, past bull markets have shown prolonged periods of extreme bullishness before reaching a clear peak, and the current situation suggests that Bitcoin has not yet reached this stage.

The current situation has similarities to Bitcoin's past bull transitions. In 2017 and 2021, Bitcoin experienced multiple short-term corrections before reaching its final peak. However, unlike these cycles, the macroeconomic environment in 2024 is significantly different. Factors such as global liquidity tightening, regulatory developments, and institutional involvement in Bitcoin will likely play a key role in shaping its next move.

Recent comparisons have been made to the carry trade crisis in August 2024, when macroeconomic pressures caused Bitcoin prices to temporarily fall despite strong fundamentals. If similar external pressures emerge, they could accelerate Bitcoin’s next correction phase.