Is Bitcoin Undervalued Right Now? On-Chain Data Has a Clear Answer

Bitcoin is trading at $70,675. And according to a long-term quantitative model tracking its full price history, that number means something most traders scanning red charts are probably missing.

CryptoQuant analyst Darkfost flagged this morning that Bitcoin has fallen below the 20th quantile of the Bitcoin Power Law model. At a current quantile of 18.5%, Bitcoin has spent only 18.5% of its entire existence at this relative valuation level.

“We are now approaching extreme undervaluation levels,” Darkfost wrote.

What Is the Bitcoin Power Law and Why Is It Flashing Now?

The Bitcoin Power Law is a long-term valuation framework built on logarithmic regression across Bitcoin’s full price history. Unlike short-term technical indicators, it measures where Bitcoin sits relative to every price it has ever traded at, adjusted for time.

Why Bitcoin Fell Back to $70K: Iran, the Blockade and the Macro Reset

Over the weekend, 21 hours of US-Iran peace talks in Islamabad ended without a deal. Bitcoin shed $3,200 on the news. Crypto markets lost $83 billion in a single day as the total market cap fell from $2.47 trillion to $2.39 trillion.

Then came the escalation. President Trump announced the US Navy will begin blockading the Strait of Hormuz, effective Monday morning. Oil futures jumped 7%. The same inflationary pressure that has kept the Federal Reserve on hold is about to intensify.

The scale of the damage is visible on-chain. Data shows 13.5 million Bitcoin addresses are currently holding at a loss – a direct consequence of the decline from October 2025’s peak above $126,000.

Also Read: Bitcoin Bear Market In Its Final Stage? 2 On-Chain Signals to Know Before Your Next Trade

Key Levels for the Bitcoin Price

With Bitcoin sitting just above critical support, the structure is fragile. $70,000 is the key psychological and technical floor. A weekly close above $71,000 is what analysts need to see for any upside continuation. $74,000 is the resistance above. If $70,000 breaks, the analyst downside target sits at $65,000.

Bitcoin’s recovery remains fragile as the war’s economic fallout looks set to dominate markets through Q2, with rate cuts pushed to Q3 or Q4 at the earliest, according to Nic Puckrin, founder of Coin Bureau.

According to CME FedWatch, there is over a 98% probability the Fed holds rates steady at both the April 29 and June 17 meetings.

Bitcoin Bear Market 2026: Pressured by the Headlines

The power law does not account for naval blockades or inflation shocks. It measures Bitcoin across its entire history and arrives at one conclusion: by that measure, it is cheap.

Whether the weeks ahead allow anyone to act on that is a different question entirely.