Bitcoin’s ‘Terminal Price’ indicates the next BTC all-time high will be at least $110,000.

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22 Jan 2024

As Bitcoin continues its upward trajectory, reaching levels not seen in 18 months, speculation about its next all-time high is rampant. A classic on-chain indicator, known as the “Terminal Price,” is suggesting that Bitcoin’s peak in the next cycle could be at least $110,000. In this blog post, we’ll explore the insights provided by this indicator, considering historical patterns and potential implications for investors.

Understanding the Terminal Price:

The Terminal Price is a key metric derived from Bitcoin’s “Transferred Price,” which is calculated by dividing “Coin Days Destroyed” (CDD) by the existing supply. CDD measures the number of dormant days reset each time a certain amount of Bitcoin moves on-chain, serving as an indicator of hodler intent and activity. Created by Philip Swift, the lead on-chain analyst at data firm Glassnode, the Terminal Price becomes relevant at the culmination of each BTC price cycle.
Notably, not every all-time high reaches the Terminal Price, but historical data indicates its significance. During the 2017 all-time high and the initial peak in April 2021, Bitcoin’s price hit the Terminal Price trendline. While the subsequent all-time high of $69,000 in November 2021 fell short, Swift suggests that selling “near” the Terminal Price could be a prudent strategy. The bear market counterpart, known as the “Balanced Price,” provides insights into potential market bottoms.
Bitcoin Terminal Price and Balanced Price chart. Source: Look Into Bitcoin

Setting Targets and Considering the Pi Cycle:

With Bitcoin’s next block subsidy halving anticipated in April 2024, analysts are setting ambitious targets, including $130,000, with late 2025 as a potential deadline for the next cycle’s top. As the Terminal Price increases over time, $110,000 might prove to be a conservative estimate if the next all-time high occurs later in the cycle.
Additionally, another indicator gaining attention is the “Pi Cycle Top.” Swift highlights its reliability in providing long-term high estimates. The Pi Cycle utilizes two moving averages, with their crossovers signaling the next high — albeit with only a few days’ notice. Swift raises the question of whether the Pi Cycle Top indicator will once again identify Bitcoin’s peak in this cycle.
Bitcoin Pi Cycle Top annotated chart. Source: Philip Swift/X

Conclusion:

While these on-chain indicators provide valuable insights, it’s crucial to approach Bitcoin investments with a well-informed and risk-conscious mindset. This blog does not offer investment advice, and readers are encouraged to conduct their own research before making financial decisions. As the crypto market continues to evolve, staying informed about on-chain indicators can empower investors to navigate the exciting yet unpredictable journey of Bitcoin’s price movements.
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Written by Shantanu Gupta

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