Despite crypto markets having consolidated sideways for the past three months, at least five on-chain indicators suggest the bull market may just be getting started, according to an analyst. 

Since the end of February, crypto’s total market capitalization has been range-bound at around $2.5 trillion. Market observers are conflicted about whether the cycle is already over or not.

These five on-chain indicators, as highlighted by analyst “ELI5 of TLDR” in a post on X on May 19, suggest it is just beginning.

Bitcoin market dominance above 56%

Historically, crypto bull markets start with a high level of Bitcoin dominance, with most traders having sold out of their altcoins during the prior bear market cycle.

On the other hand, when BTC dominance drops and altseason begins — it signals the next stage of the bull cycle, putting it one step closer to its end — but this doesn’t seem to be the case just yet.

Bitcoin (BTC) market dominance is still high at just over 56%, according to TradingView. Bitcoin’s market share has been above 50% since October 2023.

Bitcoin MVRV Z score under 6

The Bitcoin MVRV Z score, which compares the asset’s current market value or capitalization to its historical average value, usually tops at around 6 during cycle peaks according to LookIntoBitcoin charts.

It is less than half of that at the moment according to LookIntoBitcoin and has not been above 6 since March 2021.

Puell Multiple hasn't reached over 3

The Puell Multiple is another metric that aligns with cycle peaks and has yet to do so. This indicator is calculated by dividing the daily value of Bitcoin mined by the yearly moving average of that value.

According to Coinglass, the Puell Multiple dropped below 1 after the halving on April 20. Peaks of over 3 usually coincide with cycle tops and it only reached 2.4 during the 2024 price pump in mid-March.

HODL Waves

Meanwhile, charts showing how much BTC is held by different cohorts based on HODL Waves also look bullish for Bitcoin, according to LookIntoBitcoin.

Realized Cap HODL Waves provides a macro view of how much Bitcoin is held by those who bought recently compared to some time ago.

A falloff in peaks in younger bands suggests that selling pressure has been exhausted and there could be room for more gains.

"More BTC newcomers are less [committed] and are more likely to panic sell. Looks like we can still go up," added ELI5.

Bitcoin miner revenue per hash

The fifth bullish on-chain metric is the miner revenue per hash which essentially shows how much money miners make for their proof-of-work.

While it will trend down over time as network difficulty increases, ELI5 noted that the past two spikes to $0.3 per terahash per second came during previous market cycle peaks.

Related: Bitcoin clings to $67K, but analysis warns of 10% BTC price drop next

On the other hand, there are a couple of on-chain metrics suggesting that markets could be overheated and reaching the top.

The RHODL (realized HODL) ratio compares the average price of recently bought coins to the average price of coins bought 1-2 years ago. If new buyers are paying much more for BTC than longer-term holders, this could signal that the market is reaching a peak, as this metric indicated in March.

The Cumulative Value-Days Destroyed (CVDD) metric also appears to have peaked. This tracks the cumulative sum of value-time destruction as coins move from old hands into new hands as a ratio of the market age.

“If a lot of old coins start moving all at once, it could be a sign that the market is reaching a peak,” said ELI5. 

At the time of writing, BTC was trading at $66,668, down 10% from its mid-March all-time high.

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