Bitcoin’s risk-adjusted return has fallen to a level that has marked the bottom of every bear market of the last decade, the latest on-chain reading pointing toward accumulation rather than further downside.
The Sharpe ratio, which measures performance against volatility, fell to -20 on June 11, according to CryptoQuant data reviewed by CoinDesk. It reached that mark at the lows of the 2015, 2018-19 and 2022-23 cycles.
The problem is what came next. In all three cases, -20 marked the start of a long base rather than a pitch. The metric remained below the line for about five months in 2015 and about three months each in 2018-19 and 2022-23 before Bitcoin began a lasting recovery. Therefore, the signal can be interpreted as the bottom forming, not the rebound having arrived.
Meanwhile, Accumulator wallets, addresses with a history of holding rather than selling, received around 125,000 BTC in the first half of June.
Exchange reserves have fallen by approximately 80,000 BTC since February to approximately 2.71 million, with whales withdrawing more than 11,000 from exchanges in the last day.
This is the latest in a series of on-chain bottom signals over two weeks, following similar calls from valuation and sentiment indicators. They measure accumulation and depletion, not flows, and the driver of bitcoin’s recovery from its low of $59,130 to around $65,800 was the US-Iran deal, not the metrics, according to data from CoinDesk.
Today’s FOMC decision, Kevin Warsh’s first as chairman, is the next test. A hold is almost fully priced in, so the dot plot and Warsh’s tone on inflation will decide whether the recovery extends.
