The price of bitcoin (BTC) may have more than doubled in the past year, but investors who bought the biggest cryptocurrency in 2024 saw, on average, only a fraction of that according to a measure known as realized price.
The realized price is the average value of all bitcoins calculated at the price at which tokens last moved on-chain. While that amount has been around $41,000 for BTC since its inception in 2009, for coins bought last year it was around $65,901 as of December 31. With the market price closing at around $93,000, the buyers in 2024 are, on average, looking at unrealized profits of around 40%.
Tracking the realized price is important to understanding the overall profit or loss and cost basis of individual participants. This means bitcoin would have to fall about 31% for investors over the past year to get back to break-even price levels. US spot-listed exchange-traded funds (ETFs) debuted on January 11, close enough to the beginning of the year that this is a good estimate of their cost basis.
There is another reason to monitor the level. When the price of bitcoin falls below the 2024 realized price, it tends to mark a local bottom in the price of bitcoin. That happened once in January, after the ETFs launched, and several times in the middle of the year. Tracking the cost basis of the 2024 cohort is a profitable trading strategy.
As we enter 2025, the average cost basis is around $95,500, putting the consumer at a marginal gain as we start the year. At press time, bitcoin was trading at more than $96,000.
In addition, historically, the realized price offers a great level of support for bitcoin in bear markets and rarely trades below it.
