Bitcoin (BTC) Market Capitulation Event Now Sets the Stage for a Potential Continuation of the Bull Market

Record highs — be it $20,000 in 2017, $69,000 in 2021 and $109,000 this year — are great for headlines

Record highs, be it $20,000 in 2017, $69,000 in 2021 and $109,000 this year, are great for headlines and quick comparisons, but in reality don't do a great job of describing price action.

Tracking the "realized price," or the average price at which bitcoin (BTC) units are sold over time, provides a more complete picture of market trends.

The charts (above and below) illustrate the average withdrawal prices for different investor cohorts, segmented by the year they entered the market starting Jan. 1 of each year from 2017 to 2025.

The average realized price for the 2025 so far is $93,266. With bitcoin currently trading at $105,000, these investors are up approximately 12% on average.

When bitcoin began its decline from the all-time high of $109,000 in late January, it briefly fell below the 2025 realized price, a historical signal of capitulation. This period of stress lasted until April 22, when the price reclaimed the cohort’s cost basis.

Historical Context: Capitulation Patterns

Historically, when price falls below a cohort’s realized price, it often marks market capitulation and cyclical bottoms:

The data suggests that a capitulation phase has likely occurred, positioning the market for a more constructive phase. Historically, recoveries from such events mark transitions into healthier market conditions.

When bitcoin first surpassed $20,000 during the 2017 bull market, it marked a significant divergence between the market price and the realized price of just $5,149, highlighting a phase of exuberant speculation. Unsurprisingly, prices very shortly after went into a brutal reversal.

In contrast, by the depths of the 2018 bear market when bitcoin bottomed around $3,200, price at that point converged with the all-time realized price, a metric that aggregates the cost basis of all investors across cycles.

This long-term cost basis acts as a foundational support level in bear markets and gradually rises over time as new capital enters the market. Therefore, evaluating bitcoin solely by comparing cycle peaks, for example, from $69,000 in 2021 to just over $100,000 in 2025, misses the bigger picture.

The more relevant insight is that the aggregate cost basis of all investors continues to climb, underscoring the long-term maturation of the asset and the increasing depth of capital committed to the network.