Here’s Why Fidelity Chief Believes Bitcoin Is Cheap at Current Level

Here’s Why Fidelity Chief Believes Bitcoin Is Cheap at Current Level

Since July 2022, Bitcoin and the cryptocurrency market have been on a rollercoaster. With Bitcoin's recent rise in value, many investors are again becoming interested in buying coins on the market.

This resulted in a major resistance at $24,000 as opposed to last week when prices dipped massively. Jurrien Timmer from Fidelity believes that Bitcoin is currently "cheap" per the thesis on its adoption curve.

Timmer says that since Bitcoin's price-to-network ratio is currently at 2014 levels, we might be coming out soon from this bear market. However, the network continues to grow daily with the price regression curve.

BTC: Price Vs Value | Source: <a href=''>Fidelity/Twitter </a>
BTC: Price Vs Value | Source: Fidelity/Twitter 

The Fidelity director further explains that for him, the main thing to consider when looking at Bitcoin's price is how it measures up against its growth curve.

Suppose we use mobile phones or internet access as proxies. In that case, there's no doubt about what everyone knows- Bitcoin's price is below its actual and projected network growth curves, providing a fundamental anchor for the digital currency.

Bitcoin and Gold Comparison

The Fidelity chief explains that if BTC were to be compared with Gold, it would be best to see the Bitcoin/Gold ratio. According to him, the most oversold conditions in recent years have been produced by the current sell-off.

Bitcoin And Gold Ratio
Bitcoin And Gold Ratio

The percentage of Bitcoin holders refusing to sell their coins is rising. Timmer points out that this trend has been noticeable over 10-year periods, where it's crossed 13%.


Timmer points out that when comparing Bitcoin and Ethereum, Bitcoin can be said to be growing much slower. He also mentioned that Ethereum had not been rewarded enough for its higher price-to-network ratio.

He says Ethereum does not get enough reward because it has a less decentralized network than Bitcoin. Perhaps there's a chance that we'll see some changes in that aspect of ETH soon as the Merge takes place, claims Timmer.

Bitcoin And Ethereum Demand Curve
Bitcoin And Ethereum Demand Curve

The crypto winter may be coming to an end, with prices of Ethereum and Bitcoin alike continuing their upward trend over the last few months.

Disclaimer: The author's comments and recommendations are solely for educational and informative purposes. They do not represent any financial or investment advice. Always DYOR (do your own research)

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