CryptoQuant: BTC Valuation Reset Underway, Market Gradually Returning to Fundamentals According to CryptoQuant analyst MorenoDV_, Bitcoin's valuation reset is currently taking place. By observing Bitcoin's NVT Golden Cross indicator (smoothed with a 100-day moving average), the relationship between market valuation and on-chain economic activity can be assessed. NVT is considered Bitcoin's price-to-earnings ratio, where transaction volume replaces earnings to answer whether the network's market cap aligns with actual economic activity. The current NVT Golden Cross indicator shows that short-term NVT is significantly below the long-term trend, indicating that Bitcoin's market value is undervalued relative to on-chain activity. Historically, when the indicator deviates deeply into the negative, it often reflects bearish market sentiment and structural undervaluation of the network. In this cycle, the indicator once dropped to a historic low of -0.58 and has now recovered to around -0.32, suggesting that prices are gradually realigning with transaction-driven fundamentals but remain in a conservative valuation range. This phenomenon typically occurs during deleveraging and risk-averse phases, followed by an accumulation period that drives healthier price discovery. The current market is transitioning from deep undervaluation to equilibrium, with selective capital allocation potentially signaling structural improvements in the crypto market and long-term opportunities.