Bitcoin MVRV Divergence: New Momentum Toward the Undervaluation Zone

What is the divergence between market price and intrinsic value for Bitcoin? This question has become a central focus among crypto analysts today. According to the latest data from CryptoQuant, BTC’s MVRV (Market-Value-to-Realized-Value) ratio has approached 1.1 for the first time since March 2023, marking one of the lowest levels in over three years. Currently, Bitcoin is trading at $70,710, up 2.56% in the past 24 hours.

Why is this development significant? Because it signals a particular market cycle—where investors’ cost basis is approaching current price levels. Understanding this divergence plays a crucial role in making region-based decisions for long-term investors and traders.

MVRV Ratio Divergence: Technical Analysis

The MVRV ratio is a fundamental on-chain metric that measures market value relative to the last price at which coins moved. When this ratio approaches 1, it indicates that the collective cost basis is aligning with the current price.

The current divergence (at 1.1) is the most notable in the past three years. In early 2023, when BTC was trading near $20,000, the MVRV first dipped below 1. The current level, with a price of $70,710 and an MVRV ratio of 1.1, suggests the market is moving away from its previous overvaluation state.

According to CryptoQuant analysts, this divergence indicates proximity to the breakeven zone, where undervaluation becomes more likely. However, it is still above 1.0, meaning the market is not yet undervalued—rather, it is near a balance point.

Z-Score Divergence and Historical Context

Beyond a single metric, market analysts have focused on the Z-score divergence, which measures statistical deviation from historical norms. The two-year rolling Z-score of the MVRV recently touched historic lows.

Renowned trader Michaël van de Poppe commented that the current Z-score level is lower than the bottoms of bear markets in 2015, 2018, 2020, and 2022. This is a significant divergence, indicating that the market is in an extraordinarily condensed valuation.

CryptoQuant contributor GugaOnChain used an alternative Z-score method to classify BTC/USD as being in a “capitulation zone.” This divergence—where price is well below historical averages—is generally associated with accumulation activity, often preceding a subsequent rebound.

$60,000 Support Level and Current Market Activity

A few months ago, when Bitcoin fell below $60,000, it marked a critical divergence point. That price level has historically served as support and resistance in various market conditions.

Currently, at $70,710, the price is 17.8% above $60,000, suggesting the market has shown some recovery from recent weaknesses. However, the divergence signals from MVRV and Z-score indicate this bounce is not just a typical correction—rather, it points toward a structural shift in the market cycle.

Multi-Indicator Perspective: The Overall Picture

Viewing MVRV divergence in isolation would be incomplete. When combined with other on-chain signals, a clearer picture emerges:

• MVRV ratio divergence: at 1.1, close to undervaluation
• Z-score divergence: hitting historic lows
• Price action: $70,710 up 2.56% in 24 hours
• Market cap: steady at $1.4145 trillion

This alignment suggests the market may be near a critical transition point, where long-term accumulation activity could increase.

Undervaluation Zone and Market Review

When MVRV drops below 1, Bitcoin is technically considered undervalued. Although the current reading is 1.1, this region is traditionally recognized as marginal undervaluation.

Analysts argue that this cycle has shown different activity compared to previous cycles. Since the peak in October 2025, the market has not experienced a rapid “extreme undervaluation” phase. This divergence suggests the bottom could arrive quickly—not as a sudden capitulation, but as a gradual compression rather than a final capitulation phase.

Key Indicators to Watch Moving Forward

Analysts should monitor the following points:

1. MVRV at 1.0 level: if this metric falls below 1.0, it will be a clear sign of undervaluation
2. Z-score trajectory: is it starting to rise from its lows or continuing downward?
3. $60,000–$70,000 range: stability here could indicate long-term support
4. On-chain flow data: are long-term holders accumulating or distributing?
5. Broader market sentiment: how do macro conditions influence this cycle?

Conclusion: From Divergence to Balance

The current MVRV and Z-score divergences in Bitcoin represent a significant market reading. It’s not just a price level—it could be a sign of a potential cycle shift.

However, as analysts consistently warn, no single indicator provides certainty. The combination of MVRV divergence, Z-score, and price action offers a multi-dimensional picture. If these signals confirm in the coming weeks, the market could be entering an undervaluation zone where long-term investors might find opportunities.

Meanwhile, market watchers should continue to carefully monitor on-chain data, price levels, and macroeconomic conditions—since Bitcoin’s next big move may be defined before these divergences fully resolve.