The space is heating up and even after last week’s mini-dump, thanks mostly to all the drama around BitFinex, iFinex and USDT, there is another reason why traders should be optimistic. It all has to do with the MVRV (Market Value – Realized Value) ratio, an indicator that is used to estimate fair value of a crypto asset.

According to an observer, the MVRV reading moved back above 1 and gleaning from historical events, there is a likelihood that prices will rally and “Bitcoin will never revisit current price levels EVER again.” A Twitter user by the name, Cryptokea, who says he is a researcher, tweets saying:

“The MVRV Ratio and its move back above 1.0 might have just indicated the start of a new bull run. The last two times this happened, Bitcoin never revisited the price levels EVER again.”

According to BitFinex, the MVRV (Market Value – Realized Value) ratio is “calculated by dividing the market cap (market value or MV) by realized cap (total realized value or RV), and aims to show whether an asset is overvalued or undervalued.” The indicator is a creation of Murad Mahmudov and David Puell, two ardent crypto. On the other hand, MVRV is developed based on Pierre Rochard ideas. From their definition, the realized value of a crypto asset is derived from the taking the price of every coin when it was last moved, that is, when it was last realized. They reckon that realized value is a better measure of true value as it expresses the true value of what an individual paid for or valued Bitcoin at in total.

Based on this, when the total market of any asset, in this case, exceeds the realized value, then it points at an overvaluation. In that case, it is likely that prices will correct lower. On the reverse side, when the realize value is more than the total market cap, then Bitcoin is undervalued and only a small group of investors are willing to buy as the coin is worth more. Now, what’s notable now is that Bitcoin prices broke above 1 and in two different occasions when the same happened—in 2012 and 2016, prices never retested the breakout levels. Instead, asset prices rallied to new highs. If the indicator relays fact supported by shifting sentiment, then prices would likely print new highs in coming weeks and $5,000 would not be retested this year.

Already, analysts are upbeat. Behind their optimism are technical developments—like Bitcoin breaching the $5,000 mark and the MVRV ratio readings, and other fundamental factors like Bitcoin halving of next year, the SEC chance of approving any of the nine Bitcoin ETF approval, increasing adoption levels and shifting regulation recognizing the benefits of the asset not only as a transparent settlement layer but where governments can draw revenue through capital tax gains.