Bitcoin's Fair Value and Market Cycles: Insights from Analyst Murphy

According to BlockBeats, on-chain analyst Murphy has highlighted that Bitcoin's fair value is calculated as the historical average of the MVRV ratio. If the market valuation level (MVRV) aligns with historical averages, Bitcoin's price should be near this level, making the fair value a 'mean reversion center.' Over the past decade, during Bitcoin's three major cycles, the fair value (represented by the blue line) has served as a boundary between bull and bear markets. Once a bull market begins, Bitcoin is unlikely to fall below this line even if there are corrections; value reversion often triggers strong buying. In the current cycle, Bitcoin has been operating above its fair value for nearly two years. It has approached the blue line three times: following the approval of an ETF, during the unwinding of yen carry trades in August 2024, and amid the tariff crisis in April 2025. However, it has never fallen below the fair value. In a bull market, returning to the fair value presents an optimal buying opportunity. Currently, the blue line is positioned at $97,000. If traders believe the bull market foundation remains, buying Bitcoin near $97,000 could be highly cost-effective. Conversely, if they believe the market has shifted to a bear phase, they might wait for deeper bearish moments, potentially acquiring Bitcoin below $55,000. This analysis is intended for educational purposes and should not be considered investment advice.