The Cryptocurrency Benchmark Behavior Indicator (CBBI) is a powerful analytical tool designed to help investors understand Bitcoin’s market cycles by aggregating key on-chain and technical metrics. This guide answers the most common questions about how CBBI works, what it measures, and how it can be used effectively—without offering financial advice.
Understanding the CBBI and Its Role in Crypto Analysis
The CBBI Confidence Score synthesizes data from nine carefully selected indicators to assess whether the Bitcoin market is approaching an overheated (euphoric) or underheated (undervalued) state. Unlike traditional price predictors, CBBI does not forecast exact prices or dates. Instead, it provides a macro-level view of market sentiment based on historical patterns.
This makes CBBI particularly useful for long-term investors looking to identify potential turning points in Bitcoin’s bull and bear cycles.
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Can CBBI Predict Bitcoin Price Peaks or Bottoms?
No, CBBI does not predict future prices or specific dates of market tops or bottoms. It evaluates current market conditions relative to past cycles using its composite score, which ranges from 0 to 100.
A score near 100 suggests extreme market euphoria, often seen just before major corrections. A score near 0 indicates deep undervaluation, typically observed during bear market lows. However, because CBBI is both time-independent and price-independent, it should be used alongside other research tools rather than as a standalone predictor.
Why This Matters:
- Helps avoid emotional trading decisions.
- Offers context during periods of extreme FOMO or fear.
- Enables more strategic profit-taking or accumulation planning.
How Is the CBBI Confidence Score Calculated?
The composite CBBI score is derived from an average of nine distinct metrics. Each metric is normalized and interpreted uniquely by the CBBI engine to enhance human readability and relevance.
Key elements in score formation:
- Linear regression lines are applied to each metric’s historical peaks and valleys.
- These regression boundaries adjust over time to account for diminishing volatility and changing market dynamics.
- If a metric exceeds its upper or lower regression boundary, it "pegs" at 100 or 0 respectively—this is intentional, not a bug.
This adaptive design ensures that CBBI remains relevant across multiple market cycles, recalibrating after each bull run.
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Why Do Some Metrics Stay at 0 or 100 for Long Periods?
It’s normal for individual metrics to remain at 0 or 100 for extended durations. This occurs when real-world data surpasses the expected upper or lower bounds defined by regression analysis.
For example:
- During intense bull markets, network activity may exceed all prior highs, causing certain indicators to max out.
- In deep bear markets, transaction volumes might drop below historical floors, pushing scores to zero.
This behavior reflects outlier market conditions—a natural part of any asset class with high volatility. Users who believe certain metrics are distorting the overall score can disable them via toggle options on the platform.
Can the CBBI Score Go Below 0 or Above 100?
While individual underlying metrics may technically exceed 0 or 100, the final CBBI confidence score is capped:
- Minimum: 0 (indicating extreme undervaluation)
- Maximum: 100 (indicating extreme euphoria)
If most metrics fall below their expected lows, the aggregate score will flatline at 0. Conversely, if most metrics surge beyond prior highs, the score will cap at 100. This capping ensures consistency and interpretability across cycles.
Remember: CBBI is a tool, not an oracle. It relies on quality data but cannot eliminate uncertainty.
Does CBBI Identify All Bitcoin Tops—or Just Blow-Off Tops?
CBBI is specifically tuned to detect blow-off tops, characterized by:
- A sudden, parabolic rise in price and volume
- A sharp peak followed by a rapid decline
- Extreme investor sentiment and media frenzy
Historical examples include the 2013 and 2017 Bitcoin peaks, where prices surged dramatically before crashing.
In contrast, non-blow-off tops—like the $64k and $69k peaks in 2021—may not trigger strong CBBI signals because they lack the explosive volume and velocity typical of euphoric tops. These events are often driven more by sentiment than by technical breakout patterns.
By focusing on blow-off tops, CBBI aims to help users maximize profit-taking opportunities while minimizing risk.
Will Widespread Use of CBBI Cause Market Front-Running?
While any popular indicator risks being front-run, CBBI's impact is limited due to:
- Low global awareness of the tool
- The fact that only a small fraction of Bitcoin holders use advanced analytics
Even if adoption grows, markets are influenced by countless variables—no single indicator can control outcomes. Additionally, CBBI’s delayed response to extreme conditions inherently reduces the effectiveness of short-term manipulation.
When Should I Buy or Sell Based on CBBI?
CBBI does not provide buy or sell recommendations. It is strictly an analytical framework, not investment advice.
That said, some users follow strategies inspired by CBBI signals:
- Accumulating when scores are low (e.g., below 20)
- Taking partial profits as scores approach 100
Colin, one of CBBI’s contributors, has shared personal views on cash-out strategies via public videos and posts. However, these reflect individual opinions—not official guidance.
Always conduct your own research and consult financial professionals before making investment decisions.
Are the CBBI Metrics Finalized?
No. The index is currently in beta, meaning the nine metrics may evolve over time. The goal is eventual ossification—locking in a stable set once sufficient data confirms their predictive power across multiple cycles.
Importantly:
- Any changes to metrics are retroactively applied to historical data.
- This ensures consistent, apples-to-apples comparisons across all Bitcoin cycles.
Accuracy always takes priority over permanence.
How Often Are CBBI Data Updated?
- Full data refreshes occur every 2 hours
- Some metrics update daily; others more frequently
- The official CBBI Twitter bot posts daily updates around 7 AM EST to avoid cluttering feeds
This balance ensures timely insights without overwhelming users with noise.
Why Does CBBI Use the First 2021 Peak ($64k) Instead of the Second ($69k)?
CBBI identifies the **$64k March 2021 peak** as the true top because it aligned with technical signal exhaustion across multiple metrics. The later $69k peak in April was primarily sentiment-driven and lacked confirming strength in on-chain activity—making it a “sentiment top” rather than a technical one.
In chart terms, this formed a classic double top pattern with minimal price divergence between peaks.
FAQ: Donations and Data Privacy
Do you accept fiat donations?
No. To support the crypto ecosystem, we only accept donations in cryptocurrency—including stablecoins like USDT, USDC, DAI, and BUSD—via Ethereum (ERC-20) or Binance Smart Chain (BEP-20).
How are donations used?
Donations are split equally between team members (50% Colin, 50% Kamil) and cover operational costs such as data subscriptions for Bitcoin metrics.
Is user data tracked?
We use self-hosted Matomo Analytics, ensuring full privacy compliance:
- All data is anonymized
- No third-party sharing
- Users can opt out via browser "Do Not Track" settings
Technical Details
What charting library does CBBI use?
Highcharts Stock (free for non-commercial use): highcharts.com/blog/products/stock
Is CBBI open source?
Yes. Full source code is available on GitHub: github.com/Zaczero/CBBI
Core Keywords
Bitcoin market cycles, CBBI confidence score, crypto valuation indicators, on-chain analytics, Bitcoin price prediction, market euphoria detection, cryptocurrency benchmarks, blow-off top indicator
Frequently Asked Questions (FAQ)
Q: Can I customize which metrics influence the CBBI score?
A: Yes. Users can enable or disable individual metrics using toggles on the interface to tailor the score to their preferences.
Q: Does CBBI work for altcoins like Ethereum?
A: While designed for Bitcoin, CBBI can serve as a macro indicator for other cryptos since many follow Bitcoin’s price trends—especially during major cycle shifts.
Q: What happens if all metrics hit record highs simultaneously?
A: The composite score will cap at 100. This reflects maximum market euphoria and has occurred during past blow-off tops.
Q: How reliable is CBBI during sideways markets?
A: In range-bound phases, CBBI may show moderate scores (30–70), indicating neutral sentiment. It's most actionable during extremes.
Q: Where can I view real-time CBBI data?
A: Visit the official CBBI website or follow the daily Twitter bot for updates.
Q: Is there a mobile app for CBBI?
A: Not currently. Access is via desktop web browser with responsive design for mobile viewing.
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