Bitcoin Buyers Saw 40% Gain on Average Last Year, Realized Price Shows

Bitcoin Buyers Saw 40% Gain on Average Last Year, Realized Price Shows

Bitcoin (BTC) may have more than doubled in price last year, but investors who bought the cryptocurrency in 2024 are seeing much lower returns than that figure, according to a metric known as the realized price.

The realized price is calculated by determining the average value of Bitcoin based on the price at which each coin last moved on-chain. While the realized price for Bitcoin since its inception in 2009 is around $41,000, the realized price for coins bought in 2024 stood at approximately $65,901 by December 31. With the market price closing around $93,000 at the year’s end, 2024 investors were sitting on an unrealized profit of about 40%.

The realized price provides valuable insight into the overall profit or loss and cost basis for individual market participants. For 2024 investors to break even, Bitcoin would need to fall by around 31%. The launch of U.S. spot-listed exchange-traded funds (ETFs) on January 11 occurred near the start of the year, offering a reasonable estimate of their cost basis.

Monitoring the realized price is crucial for understanding potential market shifts. Historically, when Bitcoin’s market price falls below the realized price, it has often indicated a local price bottom. This occurred multiple times throughout 2024, including once in January after the ETF launch and several times mid-year. Tracking the 2024 realized price would have been a profitable strategy for traders looking to capitalize on these price movements.

As we enter 2025, the average cost basis for Bitcoin is around $95,500, placing 2024 investors in a slight profit, as Bitcoin is currently trading above $96,000.