Bitcoin MVRV Z-Score Hits Historic Oversold Levels as Price Rebounds to $91,000: A Signal for a Major Market Bottom?

Introduction

In a dramatic turn of events, Bitcoin (BTC) has reclaimed the $91,000 price level, sparking intense speculation among traders about whether the market has finally found its bottom. This rebound is occurring against a backdrop of one of the most significant technical signals in Bitcoin's history. According to prominent analyst Michaël van de Poppe, the Bitcoin MVRV Z-Score, specifically its 2-year rolling variant, indicates that BTC is currently at "the most oversold levels in history." This on-chain condition places the current market structure in the same league as the major bottoms of 2018 and the 2022 "FTX/LUNA" collapse. As large traders initiate high-leverage long positions on major assets and influential figures like Arthur Hayes embark on altcoin accumulation sprees, the crypto market appears to be at a critical inflection point, balancing between extreme fear and burgeoning institutional confidence.

Understanding the MVRV Z-Score: The Compass for Market Cycles

To grasp the gravity of the current situation, one must first understand the MVRV Z-Score. This on-chain metric is a powerful tool for assessing whether Bitcoin is trading above or below its "fair value." The calculation involves two primary components: Market Value and Realized Value.

Market Value is simply Bitcoin's current price multiplied by its circulating supply—the standard market capitalization figure. Realized Value, a concept pioneered by Coin Metrics, is a more nuanced measure. It calculates the value of each coin in circulation based on the price at which it was last moved on-chain. This effectively aggregates the cost basis of all Bitcoin holders, creating a collective "realized cap" that represents the total capital invested in the network.

The MVRV ratio is derived by dividing the Market Value by the Realized Value. When this ratio is high, it indicates that the market value is significantly greater than the aggregate cost basis, suggesting investors are sitting on large unrealized profits and the asset may be overvalued. Conversely, a low ratio suggests the market price is near or below what most investors paid, signaling potential undervaluation.

The MVRV Z-Score takes this a step further by measuring how many standard deviations the current MVRV ratio is from its historical mean. The 2-year Z-Score variant, highlighted by van de Poppe, focuses specifically on a rolling two-year window, providing insights that are more attuned to recent market cycles rather than Bitcoin's entire lifespan. This makes it exceptionally responsive to cyclical extremes.

Historical Precedents: Echoes of 2018 and 2022

The significance of the current MVRV Z-Score reading is profoundly amplified when viewed through a historical lens. According to Michaël van de Poppe's analysis, the indicator is now showing its lowest levels in the asset's history, matching the oversold conditions witnessed during two previous catastrophic bear markets.

The 2018 bear market bottom was characterized by a brutal 84% decline from its then-all-time high, culminating in a price of around $3,200. This period was marked by widespread despair and the "crypto winter" narrative, where many questioned Bitcoin's long-term viability. The MVRV Z-Score's dive into deeply oversold territory at that time preceded a multi-year recovery that eventually led to new highs.

Similarly, the 2022 bottom, often referred to as the "FTX/LUNA" bottom, saw Bitcoin plummet to approximately $15,500 following the collapse of the Terra ecosystem and the FTX exchange. This event triggered a massive deleveraging across the industry and a crisis of confidence in centralized entities. Again, the MVRV Z-Score reached historic oversold levels, which proved to be a reliable contrarian indicator before the market embarked on its next bull phase.

The current alignment of the MVRV Z-Score with these historic bottoms suggests that, from an on-chain perspective, Bitcoin is in a zone that has previously represented maximum pain and maximum opportunity.

The Bullish Divergence and Macro Context

Beyond the raw Z-Score data, Michaël van de Poppe has identified what he describes as a "hidden bullish divergence" for Bitcoin within a "clear uptrend." A bullish divergence occurs when the price of an asset makes a lower low, but a key momentum indicator makes a higher low. This technical pattern often signals weakening selling pressure and can foreshadow a trend reversal.

This potential reversal is emerging from one of Bitcoin's "heaviest" crashes, which was triggered by an unprecedented liquidation event on October 10. The subsequent price action has been described by BitMEX co-founder Arthur Hayes as a Fed’s quantitative tightening (QT)-like event for crypto—a period where liquidity is rapidly withdrawn from the system, causing forced selling and sharp price declines across digital assets.

The formation of a bullish divergence against this macroeconomic backdrop is particularly noteworthy. It suggests that despite the severe liquidity crunch and negative sentiment, underlying buying pressure may be quietly building, setting the stage for a potential recovery that could be as rapid as the preceding decline.

Whale Accumulation and Trader Positioning: Reading the Smart Money

Concurrent with these technical signals, on-chain data and exchange activity reveal significant movements from large-scale market participants—often referred to as "whales."

On November 26, Coinspeaker observed three large Hyperliquid traders opening high-leverage long positions on both Bitcoin (BTC) and Ethereum (ETH). High-leverage longs are inherently risky bets that amplify gains if the price moves upward but can lead to swift liquidation if it declines. The initiation of such positions by multiple large traders simultaneously indicates a strong conviction that a short-term rebound is imminent.

Perhaps more telling is the activity of Arthur Hayes, the former CEO of BitMEX and one of crypto's most influential voices. Hayes has publicly engaged in a buying spree, accumulating positions in several altcoins including ENA (Ethena's governance token), ETHFI (the native token of Ether.fi, a liquid restaking protocol), and PENDLE (a yield-trading protocol token). Hayes has also been actively buying and promoting Zcash (ZEC) on his social media account.

This pattern of accumulation from a figure with Hayes's market clout and track record provides a fundamental corroboration of the technical bottoming signals. It demonstrates that seasoned veterans are not only calling a bottom but are deploying significant capital to back their thesis, focusing on both established assets like BTC and ETH and select altcoins they believe have strong rebound potential.

NEAR Protocol: A Case Study in Contrarian Opportunity

While Bitcoin dominates the macro narrative, Michaël van de Poppe has also spotlighted NEAR Protocol (NEAR) as presenting a singular opportunity. He stated that NEAR is "probably one of the single best opportunities to be accumulating a position," noting that its price has retreated to its cycle low, revisiting levels not seen since the October 10 crash.

This price depreciation stands in stark contrast to significant fundamental developments within the NEAR ecosystem. The privacy-focused browser Brave recently integrated NEAR Protocol's stack to enhance AI privacy and verifiability features. Simultaneously, Kalshi, a leading prediction market platform, added support for the NEAR token.

Furthermore, key network metrics show robust health. The volume and revenue generated from NEAR Intents have seen substantial growth. This positive fundamental trajectory was bolstered one month prior by community approval of a token inflation halving, which reduced NEAR's annual emission rate from 5% to 2.5%, a change designed to make the asset more deflationary over time.

The disconnect between NEAR's strengthening ecosystem and its depressed price—attributed by van de Poppe more to the broader "market environment rather than the" project's own fundamentals—presents a classic contrarian setup. It suggests that once market-wide sentiment recovers, assets with strong underlying progress like NEAR could experience accelerated rebounds.

Strategic Conclusion: Navigating the Inflection Point

The convergence of multiple data points paints a compelling picture for cryptocurrency markets. The Bitcoin MVRV Z-Score hitting historic oversold levels at a $91,000 rebound provides a strong quantitative argument that this region represents a significant cyclical bottom, akin to generational buying opportunities seen in 2018 and 2022. The emergence of a hidden bullish divergence adds a layer of technical confirmation, suggesting that momentum may be shifting despite recent price trauma.

The actions of sophisticated market participants provide real-world validation of this thesis. The establishment of high-leverage long positions by large Hyperliquid traders on BTC and ETH reflects a high-conviction bet on an immediate upside move. Meanwhile, Arthur Hayes's diversified accumulation strategy—spanning from governance tokens like ENA and ETHFI to yield assets like PENDLE and privacy coins like ZEC—indicates a broader belief in an impending altcoin season recovery.

For readers and investors monitoring this situation, several key factors warrant close observation over the coming weeks:

• MVRV Z-Score Momentum: Watch for any sustained upward movement in this indicator as confirmation that an on-chain recovery is underway.
• Price-Level Defense: The ability of Bitcoin to hold above key support levels near its recent lows will be critical for maintaining bullish sentiment.
• Whale Wallet Activity: Continued accumulation by large addresses would reinforce the bottoming thesis.
• Macro Liquidity Conditions: Any shift in broader financial liquidity, which Arthur Hayes analogized to a crypto QT event, could serve as a major catalyst.

While no single indicator guarantees future performance, the alignment of deep historical undervaluation signals with aggressive "smart money" positioning creates one of the most defined risk-reward setups witnessed in recent crypto history. The market appears poised at a precipice where extreme fear meets burgeoning opportunity.