Key Takeaways:

• The Bitcoin Risk-Off signal dropped to 23.7, its lowest since March 2019, indicating low correction risk and a high likelihood of a bullish trend developing.

• Despite the recent decline in network activity, bullish macro indicators like the Macro Chain Index (MCI) suggest Bitcoin could soon rally above $100,000.

On May 5, the Bitcoin Risk-Off signal, an indicator that uses onchain and exchange data to assess correction risk, dropped to its lowest level (23.7) for the first time since March 27, 2019, when Bitcoin (BTC) traded at $4,000. The signal is currently in the blue zone, which historically suggests low correction risk and a high probability of a bullish trend. When the oscillator rises above 60 or turns red, it implies a high risk of bearish movement. 

In 2019, the same signal preceded a staggering 1,550% rally that saw Bitcoin soar above $68,000 in 2021. 

Data from CryptoQuant indicates that the Risk-Off signal combines six metrics: downside and upside volatility, exchange inflows, funding rates, futures open interest, and market capitalization. Collectively, they provide a balanced view of correction risk, making the signal a data-oriented gauge for market trends. 

The last time the Risk-Off Signal indicated a low-risk investment environment, Bitcoin was valued at $4,000. Several factors can explain the price disparity. 

The launch of spot Bitcoin exchange-traded funds (ETFs) in the US in 2024 opened the floodgates to institutional capital, boosting demand and stabilizing prices. In fact, ETFs and public companies now hold 9% of the Bitcoin supply. 

🚨LATEST: ETFs and public companies now hold 9% of Bitcoin’s supply! Spot ETFs own 5.5% just 1 year after launch, while public firms like Strategy hold 3.5%. Institutional adoption is reshaping $BTC‘s market—less supply, shifting dynamics. 👀👀

(h/t: @ecoinometrics ) pic.twitter.com/iC892RveP2

— Cointelegraph Markets & Research (@CointelegraphMT) May 3, 2025

Data from Fidelity Digital Assets noted that Bitcoin’s volatility has decreased three to four times that of equity indexes, down from triple-digit volatility in its early years, as illustrated in the chart below. Between 2019 and 2025, the 1-year annualized realized volatility dropped by more than 80%.

This maturing market absorbs capital inflows with less price disruption. Thus, growing mainstream adoption, regulatory clarity, and Bitcoin’s increasing role as a hedge against inflation have bolstered its value, setting a higher price floor compared to 2019.

Related: Bitcoin price forms two BTC futures gaps after Coinbase premium flips negative

Bitcoin macro indicators flash bullish signals

Cointelegraph recently reported that the Macro Chain Index (MCI), a composite of onchain and macroeconomic metrics, flashed a buy signal for the first time since 2022, when it accurately predicted the market bottom at $15,500.

Historically, MCI’s RSI crossover has preceded massive rallies, such as the more than 500% surge in 2019. Combined with rising futures open interest and favorable funding rates, the MCI suggests Bitcoin could break $100,000 over the coming few weeks. 

Anonymous crypto analyst Darkfost pointed out that Bitcoin’s network activity index has declined sharply, reflecting reduced transaction volume and fewer daily active addresses since December 2024. The drop in UTXOs further indicates waning demand for block space, a pattern often seen in bear markets.

However, the analyst explained that it doesn’t confirm a bearish outlook. Macro indicators remain strongly bullish, suggesting this lull could be a strategic entry point for long-term investors. 

Related: How much Bitcoin can Berkshire Hathaway buy?

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.