Bitcoin's recent decline has pushed on-chain valuation metrics into undervalued territory, though the asset remains more expensive than at prior cycle bottoms, according to Grayscale Research. Head of Research Zach Pandl stated on June 9 that a composite valuation model combining three separate on-chain measures indicates Bitcoin is now trading below its long-term fair value after falling to a new cycle low.

Valuation Signals and Market Maturity

While the metrics suggest undervaluation relative to historical averages, the signal is not as extreme as levels seen during major market capitulation events, such as the collapse of crypto exchange FTX in 2022. Grayscale attributes this moderation to a less severe preceding bull cycle and structural improvements across the asset class. These improvements include the expansion of exchange-traded products, broader deployment across wealth management platforms, and increasing institutional adoption.

Key Catalysts for Recovery

Determining whether the market has found a definitive bottom depends on two near-term factors. The first is progress on the CLARITY Act, proposed legislation aimed at establishing a clearer regulatory framework for digital assets in the U.S. While Grayscale remains optimistic about the bill's prospects, prediction markets indicate the outcome remains uncertain. The second factor involves highly leveraged Bitcoin holders and whether they can successfully stabilize their balance sheets during the ongoing downturn. Pandl suggested that dollar-cost averaging may make sense for long-term investors seeking exposure at discounted valuations.

Binance co-founder Changpeng Zhao urged the cryptocurrency community on Monday not to panic over Bitcoin's ongoing downturn, voicing confidence that the leading cryptocurrency will bounce back despite recent market turbulence. Zhao, known as CZ, addressed the surge in negative sentiment and search interest surrounding the asset, emphasizing that the current wave of fear is temporary.

Search Interest Surges

Google Trends data indicates that search interest for the term "Bitcoin is dead" shot to an all-time high of 100 in February and has climbed back up strongly during the recent downturn. This metric often spikes during periods of significant price decline, reflecting retail investor anxiety. Despite the data, Zhao reassured supporters, stating on X, "Bitcoin won’t be ‘dead’ for too long. Don’t panic, in large friendly letters."

Historical Context and Strategy

The Binance founder has utilized similar calming language during previous market corrections. In February 2025, he posted on X, "No need to panic, Bitcoin won’t die." Zhao, whose fortune is estimated at $109 billion, remains a prominent advocate for Bitcoin. He advocates for a strategy of selling when greed reaches its peak and buying when fear is at its highest to maximize returns amid Bitcoin's erratic cycles. Last year, he revealed that BNB made up over 98% of his cryptocurrency portfolio, with only 1.32% allocated toward Bitcoin.

Market Downturn Drivers

Zhao's comments arrive amid fresh turmoil in the Bitcoin market, where the leading cryptocurrency tumbled below $60,000 to hit its lowest level since October 2024. The downturn accelerated after Strategy—Bitcoin’s largest corporate buyer—reported selling some of its BTC holdings. This action undermined the "never sell" thesis that many bullish investors had relied upon, contributing to the broader market sell-off.