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Bitcoin on the Brink: $95,000 Support Threatened by Valuation Risks
Bitcoin on the Brink: $95,000 Support Threatened by Overvaluation Risks
February 17, 202510:31 GMT+2
BTCUSD−1.72%
Bitcoin has managed to hold strong support at $95,000 for some time. However, this level may face challenges as the cryptocurrency’s overvaluation could lead to a correction.
If this support is broken, Bitcoin could see a drop, possibly reaching $92,000, which would cause further concern for investors.
Bitcoin is facing problems
The network value to transactions (NVT) ratio is currently at a five-month high, a level last seen in September 2024. The NVT ratio, which measures the relationship between the value of the Bitcoin network and the volume of transactions, indicates that the network value is significantly higher than the actual transactions. This imbalance typically indicates that Bitcoin is overvalued, and has historically served as a catalyst for price corrections.
A high NVT ratio indicates that Bitcoin’s price may be out of line with its underlying network activity, suggesting a potential pricing mismatch. As this mismatch persists, the chances of a price correction increase, meaning that Bitcoin could face a decline towards lower support levels unless its network activity can catch up with its valuation.