$BTC

On February 1, well-known cryptocurrency influencer Sea Bitcoin highlighted a notable shift in Bitcoin’s on-chain accumulation signal, drawing attention to the ahr999 indicator, a metric widely followed by long-term Bitcoin investors. According to BlockBeats, the ahr999 index has fallen below 0.45, a level commonly referred to as the “bottom line,” marking the first time this threshold has been breached in 839 days. The last occurrence dates back to October 16, 2023, underscoring the rarity and potential significance of the current reading.

The ahr999 indicator is designed to evaluate whether Bitcoin is undervalued or overvalued by combining short-term cost data with long-term valuation trends. Specifically, the indicator is calculated by taking the current Bitcoin price, dividing it by the 200-day dollar-cost average (DCA), and then multiplying the result by the ratio of the current price to Bitcoin’s exponential growth valuation.

The 200-day dollar-cost average represents the average price paid by investors who have purchased Bitcoin consistently over the past 200 days. This component reflects short- to medium-term investment costs and helps assess whether current market prices are favorable relative to recent accumulation behavior.

Meanwhile, the exponential growth valuation is derived from an exponential fitting model based on Bitcoin’s historical price data and block height or time progression. This valuation attempts to capture Bitcoin’s long-term fair value, accounting for its diminishing issuance, network growth, and historical adoption trends.

Historically, an ahr999 reading below 0.45 has been interpreted as a strong accumulation zone, suggesting that Bitcoin may be significantly undervalued relative to both its long-term growth trajectory and recent investor cost basis. Past instances of the indicator entering this range have often coincided with market bottoms or late-stage bearish conditions, attracting long-term holders and institutional accumulators.

While the indicator alone does not guarantee immediate price reversals,