Valuation Metrics

Valuation metrics compare Bitcoin's market price to various on-chain cost bases and fair value models. They help identify periods of overvaluation and undervaluation by anchoring price to the aggregate behavior of all network participants.

#API Example

curl -H "x-api-key: YOUR_API_KEY" \
  "https://chartinspect.com/api/v1/onchain/{metric_id}?chain=bitcoin&days=365"

Replace {metric_id} with any metric ID listed below.

#MVRV

Metric ID: mvrv

Market Value to Realized Value ratio. MVRV divides the current market capitalization by the realized capitalization (the aggregate value of all coins priced at the time they last moved on-chain).

Interpretation: Values above 3.5 historically indicate significant overvaluation and have coincided with cycle tops. Values below 1.0 indicate that the market is trading below its aggregate cost basis, signaling undervaluation and historically marking cycle bottoms.

#MVRV Z-Score

Metric ID: mvrv-z-score

The standard deviation of MVRV from its historical mean. This normalizes MVRV into a comparable oscillator across cycles of different magnitudes.

Interpretation: Z-Score values above 7 have historically marked cycle peaks. Values below 0 suggest the market is trading below its average cost basis, representing high-conviction accumulation zones.

#NUPL (Net Unrealized Profit/Loss)

Metric ID: nupl

Net Unrealized Profit/Loss measures the difference between unrealized profit and unrealized loss across all coins, normalized by market cap. It ranges from -1 to 1.

Interpretation: Above 0.75 signals euphoria and historically precedes major corrections. Between 0.5 and 0.75 is the belief/denial zone. Below 0 indicates capitulation, where the majority of the network is holding at a loss.

#NVT Ratio

Metric ID: bitcoin-valuation-metrics

Network Value to Transactions ratio. Compares the network's market capitalization to the total value transferred on-chain, analogous to a P/E ratio for blockchain networks.

Interpretation: A high NVT suggests the network is overvalued relative to its economic throughput. A low NVT implies strong on-chain utility supporting the current valuation. Sustained high readings without corresponding transaction volume growth can precede corrections.

#Realized Cap

Metric ID: bitcoin-caps

The realized capitalization values each coin at the price it last moved on-chain, rather than the current spot price. This provides an aggregate cost basis for all network participants.

Interpretation: Realized cap tends to act as a support level during bear markets. When market cap falls below realized cap, it indicates that the average holder is underwater. Rapid increases in realized cap suggest new capital inflows.

#CVDD (Cumulative Value Days Destroyed)

Metric ID: cvdd

Cumulative Value Days Destroyed prices each coin-day destroyed by the price at the time of destruction, then accumulates this over the entire history of the network.

Interpretation: CVDD has historically acted as a reliable price floor during bear markets. Price touching or dipping below CVDD has marked generational buying opportunities in prior cycles.

#Puell Multiple

Metric ID: daily-issuance

The Puell Multiple divides daily miner revenue (in USD) by its 365-day moving average. It captures deviations in miner income from the yearly norm.

Interpretation: Values above 4 indicate miners are earning far above average, often coinciding with cycle tops and increased sell pressure. Values below 0.5 suggest miner distress and capitulation, historically marking cycle bottoms.

#Reserve Risk

Metric ID: reserve-risk

Reserve Risk measures the confidence of long-term holders relative to the current price. It is the ratio of price to the cumulative opportunity cost of holding (HODL Bank).

Interpretation: Low Reserve Risk values indicate high confidence among holders at low prices, presenting favorable risk/reward. High values suggest holders are less confident or are being rewarded for selling, signaling elevated risk.

#Bitcoin Yardstick

Metric ID: bitcoin-yardstick

The Bitcoin Yardstick divides the market capitalization by the hash rate. It measures how expensive Bitcoin is relative to the energy and computational resources securing the network.

Interpretation: High values suggest the market cap has grown faster than the hash rate, indicating potential overvaluation. Low values indicate that the network's security spend is high relative to its market cap, historically a sign of undervaluation.

#True Market Mean

Metric ID: true-market-mean

The True Market Mean calculates the average cost basis of only the actively circulating supply, excluding coins that are likely lost or permanently dormant.

Interpretation: This serves as a more accurate "fair value" reference than realized price. Price trading below the True Market Mean signals deep undervaluation, as even active participants are holding at a loss on average.

#VDD Multiple (Value Days Destroyed Multiple)

Metric ID: vdd-multiple

The VDD Multiple normalizes the value of coin-days destroyed by comparing current levels to the yearly moving average.

Interpretation: High VDD values indicate that long-dormant coins are being moved at elevated rates, often occurring near market tops as old hands distribute. Low values suggest minimal movement of aged coins, consistent with accumulation phases.

#AVIV Ratio

Metric ID: aviv-z-score

The Active Value to Investor Value ratio compares the active market capitalization to the investor capitalization. It refines MVRV by focusing on economically active supply rather than total supply.

Interpretation: Similar to MVRV but more responsive to current market dynamics. Elevated AVIV values indicate that active participants hold significant unrealized profits, increasing the likelihood of distribution. Low values signal that active supply is close to or below its cost basis.