This Bitcoin Indicator Just Hit 2019 Lows - Is a Massive Rally Coming?

May 20, 2025 (Investorideas.com Newswire) Anyone who trades crypto knows the feeling-you're constantly hunting for that one signal, that little clue on the chart that might just tell you if a huge price move is coming soon.

Sometimes, these signals echo moments from the past, sparking debate about whether history is about to repeat itself. Recently, a specific Bitcoin risk metric dropped to a level not seen in over five years, a time that preceded an absolutely enormous bull run.

Naturally, this has people talking. Could this Risk-Off signal, combined with the market's recent signs of life after a rough patch, really mean another explosive rally-potentially even mirroring the 1,550% surge seen last time-is on the cards for Bitcoin? Or are other factors telling a different story this time around?

Recovering Lost Ground: A Look at Recent Crypto Price Action

Let's set the stage. According to Binance data, the prices of Bitcoin, major altcoins, and even new cryptocurrencies like TRUMP, PI, and PENGU took a hit following President Donald Trump's inauguration on January 20. In fact, by April 9, the combined digital asset market capitalization fell 25.76%, with the BTC price taking a significant, 30% hit from its all-time high of $109,114 on January 20.

But things have been looking up lately; the crypto market is currently in recovery mode. While the total digital asset market cap is still down about 5.21% compared to where it started the year, BTC itself is now in positive territory, surging around 30% between April 9 and May 8. Even newer coins like TRUMP, PI, and PENGU have notched gains over 10% in just the last few days. Major altcoins aren't being left out either-ETH is up 6.44% and BNB has climbed 2.14% over the past seven days.

This recovery follows a period where global uncertainties, especially those trade war fears sparked by the new US tariff policies, put a real damper on the digital asset market. Seeing Bitcoin and other cryptocurrencies regain ground after that significant drop from the January highs shows some renewed confidence returning to the space, making the timing of certain technical signals even more interesting.

BTC Risk-Off Signal: What Does it Mean for Investors?

So, what's this signal causing all the buzz? On May 5, an indicator called the Bitcoin Risk-Off signal dropped to 23.7. According to Cointelegraph's analysis, that's the lowest this metric has been since March 27, 2019. Back then, Bitcoin was trading around a mere $4,000.

What followed that 2019 low point? A jaw-dropping 1,550% rally that eventually took Bitcoin above $68,000 in 2021. Seeing the signal hit that same low naturally makes people wonder if a similar explosion could be brewing.

The Risk-Off signal itself is designed to gauge the likelihood of a market correction. It combines six different data points-things like price volatility (both up and down), how much crypto is flowing into exchanges, futures market data (funding rates and open interest), and market cap-to get a sense of market health. When it's in the blue zone, as it is now, it historically suggests the risk of a major downward correction is low, and the chances of a bullish trend starting or continuing are high.

Of course, the obvious question is: if the risk signal is the same as when BTC was $4,000, why isn't the price $4,000 now? The market has changed dramatically since 2019. The biggest difference is the arrival of institutional players, largely thanks to the US spot Bitcoin ETFs launched in 2024. These regulated products created an easy on-ramp for serious capital. Data shows that around 6.38% of the total BTC supply is held in ETFs, with an additional 5.01% owned by private and publicly-traded companies.

Furthermore, Bitcoin itself isn't quite as wildly volatile as it used to be. Research from Fidelity Digital Assets shows that BTC's volatility has decreased considerably compared to traditional stock indexes-it's now three to four times higher than equity index volatility, down from triple-digit levels in its early years.

Between 2019 and 2025, BTC's one-year realized volatility dropped by over 80%. This increased maturity means the market can absorb inflows of cash with less dramatic price swings, establishing a much higher price floor than existed back in 2019.

Adding to the bullish case, other macro indicators also flash positive signs. The Macro Chain Index (MCI)-another composite indicator-recently issued its first buy signal since late 2022, when it accurately called the market bottom around $15,500. Historically, that signal's crossovers have preceded huge rallies. The futures market is also showing signs of life, with Bitcoin open interest climbing $2.2 billion in April and funding rates generally staying positive, suggesting traders anticipate higher prices.

However, it's not all unequivocally bullish. Analyst Darkfost recently pointed out that Bitcoin's network activity index has actually dropped sharply since December 2024. This means fewer transactions and fewer daily active addresses, which can sometimes be seen during bear markets. So, while the Risk-Off metric and some macro indicators look promising, the underlying network usage seems sluggish.

Is a 1,550% BTC Rally Imminent?

So, could we see another 1,550% run? History rarely repeats exactly, especially in a market as dynamic as crypto. The low Risk-Off signal is certainly intriguing, particularly given its track record. When combined with other bullish macro indicators and the recent price recovery, it paints a potentially optimistic picture.

However, the decreased network activity is a valid counterpoint that can't be ignored. It suggests grassroots demand might be lagging behind the institutional flows and market structure shifts.

Whether the low-risk environment signaled by the metric, fueled by institutional involvement and recovering prices, can overcome the current lull in network usage will likely determine if Bitcoin is truly setting up for another massive rally or a more measured climb.

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