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Is Bitcoin Top Already In? Puell Multiple Suggests So

Press Releases Crypto News Bitcoinist Is Bitcoin Top Already In? Puell Multiple Suggests So

On-chain data shows the Bitcoin Puell Multiple has recently touched levels that historically lead to local tops for the cryptocurrency’s price.

Bitcoin Puell Multiple Has Recently Made A Retest Of Historical Resistance

As an analyst in a CryptoQuant Quicktake post explained, the Puell Multiple has held relevance for the asset’s price throughout the past. The “Puell Multiple” refers to an indicator that measures the ratio between the daily Bitcoin miner revenue (in USD) and its 365-day moving average (MA).

The “miner revenue” here only includes the block rewards these chain validators receive for solving blocks on the network. The transaction fees, the other component of the total income of the miners, aren’t taken into account by the indicator.

The block rewards directly correlate with the cryptocurrency’s price, as their BTC value naturally remains fixed (except for during halving events, where they are permanently cut in half). Still, the USD value fluctuates with the spot price.

The transaction fees don’t carry the same relationship, as their value depends on the traffic conditions on the blockchain. Users are only incentivized to attach higher fees when the mempool involves long waiting times.

The traffic does tend to go up as the price rallies since more investors are attracted to the chain and make transactions, clogging up the mempool. But such a rush could happen for reasons unrelated to the price, like how it happened recently due to the Inscription craze.

As the Puell Multiple compares the miners’ block rewards revenue against its yearly average, it can tell us whether the miners are making more or less than normal.

If the miners’ baseline is considered a “true value” for the asset, then the indicator’s value can provide hints about whether the cryptocurrency is currently overvalued.

Now, here is a chart that shows the trend in the 7-day exponential moving average (EMA) Bitcoin Puell Multiple over the his

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Author: Keshav Verma

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