A bubble is not about how high is the price of something (tulip bulbs, diamonds, dot-com stocks...), it is when the price is not justified. It is a bit for everyone to decide if the price of an asset is justified really, there is not a magic formula that will tell you if it is. In stocks or investments you can make a "discounted cash-flow" apply a rate of return and make some hypothesis about economy, growth and "moat" and at least you will get a number from it. On other assets, the price will be fixed by supply and demand (and that is the case for bitcoin) since they do not produce a regular cash flow.
When it comes to decide if there is a bubble, you have to think about how much is worth to you. How much would you pay to get, e.g. a 4% in dividend instead of spending the money today in a car or a TV? How much would you pay for a diamond or even a soccer ticket? (my personal for those two is quite low)? Or, How much would you pay for 1 in 21 million bitcoins?
Getting to the point, bubbles happen when you start buying something just because you think someone will pay more for it, instead of looking at how useful is it for you or for a community of people. Buying something is actually telling the market that they are wrong, and what you are buying is worth more than what the consensus means. This is being contrarian, anything else is speculating and creating bubbles.
Indeed. The absolute level have nothing to do with whether something is a bubble or not - and it is a common misconception that people think just because the stock market has been going up consistently over the last 40 years that it must be a bubble.
Sure, indices are at all time highs but along with it are fundamentals are earnings figures.
The same thing can be applied to BTC, even though DCF is obviously not applicable due to the lack of cash flows here. The level of adoption and institutional interest can be a gauge in BTC's fundamental valuation, and it's certainly in line with price action right now.
I agree with the bubble concept you said. There will never be a single ratio that can measure the value of a stock, crypto or any other asset. Because the birth of the fundamental ratio is also based on mitigating losses on investments based on whatever they can compare. Our bubble indicator, the majority of the market makes purchases based on unfounded perceptions and is only influenced by lust for high returns later. In fact, with the majority of the market rushing in making decisions without doing many comparisons for consideration, it will create huge losses in the future. Bubbles will break easily with just one sentiment. Such is the current state of affairs in the crypto market. China's sentiment towards BTC, brought down the price by 50%.