On-Chain Data Multi-Dimensional Interpretation: Current Market Bottom Signals and Investment Decision Framework

In the cycle of the crypto market, relying solely on a single price trend for judgment often fails. This in-depth analysis based on on-chain professional insights from @CryptoChan, @lookonchain, @Glassnode reveals the true market signals of Bitcoin and Ethereum from multiple dimensions.

Four-tier Evaluation System for ETH Bottom Position Building

Ethereum and Bitcoin have fundamentally different chip characteristics. ETH has an unlimited total supply, a large amount of early profit chips deposited, and relatively weaker consensus strength, which requires more stringent confirmation conditions for low-position entry. Currently, ETH trading price is $3.14K, and we need to consider the following four independent dimensions:

First Dimension: Long-term Holder Sentiment Indicator (LTH-NUPL)

LTH-NUPL measures the unrealized profit and loss status of on-chain long-term funds. When this indicator drops below 0, it means even the most patient funds are in floating losses, indicating extreme market panic but also a reversal in risk-reward. The true bottom must let long-term funds experience pain first. Currently, this data is at 0.4, not yet triggering a bottom.

Second Dimension: Chip Profitability Structure (PSIP)

This indicator reflects the proportion of circulating supply that is in profit. When PSIP is below 50%, it means more than half of the liquid chips are at a loss, and the cost-effectiveness begins to show. Currently, ETH’s PSIP is 61.7%, indicating profit chips still dominate, and selling pressure remains.

Third Dimension: Price Premium Relative to Main Cost

By tracking the average buy-in cost of wallets of different sizes, we can judge the attractiveness of the price relative to institutional holders. The cost line for 1k-10k ETH holders is $2,260, while for whales holding over 100k ETH, it is $2,599. When the price is below these key cost lines, it can be considered to have a clear cost-performance advantage.

Fourth Dimension: Market Momentum Composite Score (0-6 points)

This is a multi-dimensional scoring system tracking ETH’s state, integrating six independent conditions from on-chain data, behavior, and sentiment. Deep purple area (score <1) indicates a structural weakening after a correction, with the market entering a defensive mode. Currently, none of the four standards are fully met; it is recommended to attempt small positions only when at least two conditions are satisfied, and consider adding when more than three are met.

This framework essentially protects retail investors: executable, verifiable, improves win rate, and saves funds. With ample institutional funds and flexible strategies, we should establish our own decision system, avoid noise interference, and patiently wait for more certain opportunities.

Bitcoin Status: Stable Accumulation and Potential Breakthrough

Bitcoin’s current price is $91.35K, with a 24-hour increase of +1.34%.

Formation of Short-term Trading Window

When the daily chart shows a straight line and the hourly chart oscillates repeatedly, it creates precise trading opportunities. With proper methods, each rebound can yield 8-10% profit, executing signals rather than gambling on feelings.

Stable On-chain Positioning Sentiment Signal

Although the price has not stabilized above $90,000, on-chain data shows investor sentiment is turning optimistic. Over the past week, about 30,000 BTC have been withdrawn from exchanges, indicating buy volume significantly exceeds sell volume. Most holders are insensitive to short-term price fluctuations, reflecting a long-term strategic mindset of institutions and large investors.

Differentiation Between High-net-worth Investors and Small-scale Investors

Spot ETF net outflows have persisted, so BTC inflows to exchanges are almost not from institutions. Data confirms that high-net-worth investors holding over 10 BTC continue to accumulate steadily, unaffected by price fluctuations; while retail investors holding less than 10 BTC have been selling since March 2025, influenced more by policies, economy, and sentiment.

Rebound Signal in Perpetual Contract Leverage Positions

As the price rises above $90,000, open interest increased from 304,000 BTC to 310,000 BTC (+2%), and funding rates rose from 0.04% to 0.09%. This indicates leveraged longs are preparing for potential year-end market movements.

Three Major Buying Waves in Exchange Position Data

Over the past year, exchange position data shows three large-scale buying waves, each nearly pushing BTC to new historical highs. The fourth buying wave is brewing.

Stablecoin Supply Ratio (SSR): Measuring Market Buying Power

SSR = Total Market Cap of Bitcoin ÷ Total Market Cap of Stablecoins

This indicator quantifies “how much upward pressure on BTC price if all stablecoins are used to buy BTC.”

• Lower value (strong buying power): Stablecoins are relatively abundant, indicating ample off-chain funds, with enough ammunition to push BTC higher, usually a bullish or bottom signal.
• Higher value (weak buying power): BTC market cap is relatively high, with insufficient subsequent buying funds, making price sustainment difficult, often a bearish or overheated top signal.

Combined with Bollinger Bands, when SSR hits the upper band, it signals “overheated”; falling below the lower band indicates high historical buying power.

Key On-chain Indicator System Analysis

LTH-SOPR: Long-term Holder Realized Profit Rate

This measures the profit ratio of addresses holding over 155 days. >1 indicates profit-taking, =1 indicates balance, <1 indicates loss realization. When this indicator is high, it suggests a market at a potential top; when low (especially <1), it signals a bottom or late bear market.

30-day Net Change in Realized Market Cap: Capital Flow Indicator

Positive indicates new funds entering, negative indicates outflows. Sharp peaks in positive values often appear in late bull markets (overheating risk), breaking below zero and continuing downward signals “panic selling,” shifting market sentiment from optimistic to pessimistic.

Bitcoin Realized Profit and Loss Ratio (365-day MA)

By comparing the moving averages of realized profits and losses over the past year, it reflects overall market participant profit/loss status. High in bull markets, low in bear markets. This indicator helps judge whether the market is overheated or overly fearful.

VDD Multiple: Ratio of Short-term Spending to Long-term Average

When VDD < 0.75, it indicates long-term holders are reducing old coin sales, and the market is cooling or at a potential bottom; long-term holders prefer holding rather than selling.

Realized Price Four-year Cycle Series

Excluding chips held over 7 years, reflecting the average buy-in cost of relatively active market participants. The previous cycle lasted 1136 days, the last 1143 days, and this cycle has 988 days so far, with the cycle signals gradually becoming clearer.

Dominance of Stablecoin Liquidity

90-day moving average shows USDT+USDC transfer volume averages about $192 billion daily, nearly twice the combined transfer volume of the top 5 crypto assets ($103 billion). In on-chain value transfer, USDC accounts for about $124 billion, USDT about $68 billion, while BTC is only $81 billion and ETH just $7.9 billion. Stablecoins have become the main liquidity channel.

Fear Signal in Options Market

The implied volatility of 6-month BTC put options has surged to levels seen during the Luna crisis in 2022, reflecting market panic over continued downturns and demand for downside protection at an all-time high.

True Market Cost Price and Bubble Clearance

When BTC drops to the “True Market Mean Price,” it often signifies a major clearing of speculative bubbles. This indicator excludes miner-produced Bitcoin, focusing on actual trading chips in the secondary market, helping identify overvalued or undervalued states. After bubble clearance, market direction remains uncertain, but a period of consolidation and potential rebound can be expected.

Corporate Balance Sheet Strategy Shift

Since January 2023, the total Bitcoin holdings of public and private companies have grown from 197,000 to 1,080,000 BTC, an increase of about 448%. Companies no longer see BTC as a speculative asset but as a strategic asset, a typical feature of the institutional cycle, representing a new standard of large-scale adoption. Although this demand is slow accumulation rather than explosive, no asset class has matured so quickly.

Insights from 2025 and 2024 Asset Comparison

2025 Performance: Silver +130%, Gold +65%, Copper +35%, Nasdaq +20%, S&P 500 +16%, Bitcoin -6%, Ethereum -12%, Altcoins -42%

2024 Performance: Crypto assets perform strongly, precious metals stagnate

This panic sentiment is precisely the opportunity to deploy heavily into cryptocurrencies. Institutions are accumulating, long-term funds are at the bottom, and retail sentiment is extremely pessimistic—this is a typical feature of historic opportunities.

Build your own decision framework, avoid short-term noise, and focus on long-term opportunities.