Top Cap and Delta Cap: New Metrics for Spotting Bitcoin Price Trend Reversals

Cryptocurrency researchers Willy Woo and David Puell released several new valuation metrics for bitcoin's price in February. Here's an overview.

AccessTimeIconMar 28, 2019 at 2:40 a.m. UTC
Updated May 2, 2022 at 3:49 p.m. UTC

Believe it or not, there are more ways to anticipate the future market value of bitcoin than through practicing technical analysis or by observing network activity developments.

While valuable in their own right, thanks to researchers Willy Woo and David Puell, several new experimental bitcoin valuation metrics were released in February that combine the two fields to create a more holistic view of bitcoin’s market.  

Sample sizes are small in the cryptocurrency markets, with the oldest, bitcoin, having existed just 10 years, but two of the newly released metrics termed “Top Cap” and Delta Cap” have shown to be effective at identifying the tops and bottoms of bitcoin’s wild market cycles thus far.

Delta Cap

Proposed by Puell, the metric that successfully caught both bear market bottoms in 2011 and 2015, and that is known as the Delta Cap, is calculated as follows:

Delta cap = Realized cap - Average cap

Average cap =  "cumulative sum of daily market cap values / age of the market in days."

Realized cap = “UTXOs are aggregated and assigned a price based on the BTCUSD market price at the time when said UTXOs last moved”


Resembling a long-term moving average that is touted for offering price support and resistance, the delta cap has shown to have the same effect by providing price support at roughly $2.50, the bottom in 2011, and $176, the bottom in 2015.

As can be seen above, delta cap is making a case for bitcoin having bottomed out once again, a point made evident by the fact that its price bounced off of the metric during its drop to $3,200 at the end of 2018,

Indeed, delta cap may be pointing to bitcoin’s market leaving its bearish trend, but there could be more nuance to the situation than first meets the eye.

Bitcoin has only ever bottomed out and escaped one of its infamous bear markets after the delta cap and average caps have collided with eachother, or came very close to it, as can be seen in both 2011 and 2015.

At the time of writing, delta cap is about $1,600 higher than the average cap, theoretically suggesting bitcoin’s price will either have to wait for the average cap to rise and meet the delta cap, or the delta cap will need to fall to meet the average cap by way of more significant market depreciation before a true bottom can form.

Top cap

Proposed by Woo in collaboration with Puell, top cap aims to achieve the opposite of the delta cap, in that is has been experimentally configured to pinpoint the tops of bitcoin’s explosive bull markets.

Top cap = Average cap * 35

According to, the multiple of 35 was found to pinpoint bitcoin historical tops.

As can be seen, the metric also resembles a moving average and effectively provided resistance at $35 in 2011, $237 in 2013 and once again at around $1,000 in the same year, all of which were precise market tops followed by significant, albeit temporary depreciation.

Most recently, bitcoin’s price came in contact with the top cap when its market reached peak euphoria and an all-time high near $20,000 in 2018. At the time of writing, bitcoin's price is still roughly 80 percent below the all-time high.

Putting it all together

When both delta and top cap are plotted on the same chart, a “valuation Bollinger band” is created as Woo puts it, where the two metrics create the anticipated boundaries of bitcoin’s market movement.


Currently located at $48,724, the top cap paints a rosy picture for the future of bitcoin if it indeed endures another boisterous bull market, although the creator Woo thinks $90,000 is a better estimate “at a minimum on the early trajectory” for bitcoin's next significant market top. 

Disclosure: The author holds several cryptocurrencies, please see Sam’s author profile here for more information. 

Math image via Shutterstock; Charts from


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