CryptoQuant User Guide
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  • 🔍What is CryptoQuant
    • Introduction
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    • 5 Minute Data Guide
      • 3 Key On-Chain Metrics
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      • 1. Charting Overview
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        • Miner Selling
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    • Exchange Flows/Indicators
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      • Exchange Inflow - Spent Output Age Bands
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    • Miner Flows/Indicators
      • Miner Outflow
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      • Miners' Position Index (MPI)
      • Miner Supply Ratio
    • UTxO Data/Indicators
      • Profit and Loss (UTxO)
      • Profit and Loss (Supply)
      • Coin Days Destroyed (CDD)
      • Binary CDD
      • Mean Coin Age (MCA)
      • Sum Coin Age (SCA)
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      • Spent Output Profit Ratio (SOPR)
        • aSOPR (Adjusted SOPR)
        • STH-SOPR
        • LTH-SOPR
        • SOPR Ratio (LTH-SOPR/STH-SOPR)
      • Net Unrealized Profit/Loss (NUPL)
      • UTXO Bands (Age)
        • UTXO Age Bands
        • Realized Cap - UTXO Age Bands
        • Realized Price - UTXO Age Bands
        • UTXO Count - Age Bands
        • Spent Output Age Bands
      • UTXO Bands (Value)
        • UTXO Value Bands
        • Realized Cap - UTXO Value Bands USD
        • UTXO Count - Value Bands
        • Spent Output Value Bands
    • Market Data/Indicators
      • Open Interest
      • Funding Rates
      • Estimated Leverage Ratio
      • Taker Buy Sell Volume/Ratio
      • Capitalization models
      • Realized Price
      • Exchange Whale Ratio
      • MVRV (Market Value to Realized Value) Ratio
    • Network Indicators
      • NVT Ratio
      • NVT Golden Cross
      • Puell Multiple
      • Stock to Flow Ratio
      • Stock to Flow Reversion
      • NVM Ratio
    • Stablecoin Exchange Flows/Indicators
      • Stablecoin Network Data
      • Stablecoin Exchange In/Outflow & Netflow
      • Stablecoin Exchange Reserve
      • Stablecoin Exchange Addresses Count
      • Stablecoin Exchange Transactions Count
      • Stablecoins Ratio
      • Stablecoin Supply Ratio (SSR)
    • Fund Data & Premium
      • Grayscale Bitcoin Trust (GBTC)
        • GBTC Digital Asset Holdings
        • GBTC Premium or Discount
      • Grayscale Ethereum Trust (ETHE)
        • ETHE Digital Asset Holdings
        • ETHE Premium or Discount
      • Coinbase Premium
      • Korea Premium Index
      • Bank Supply Ratio
  • 🛠️Web3 Analytics Tool
    • Overview
    • Cohort Data Navigation
    • Query Data Navigation
    • How to Use(Query Tool)
      • 1. DateTime Aggregation
      • 2. Query Block - Metric
      • 3. Query Block - Where
      • 4. Query Block - Group by
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      • 6. Query Block - Order by
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On this page
  • Definition
  • Interpretation
  • Use Case
  • RSI based market spotting
  • Link to Our Data

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  1. CryptoQuant Metrics
  2. Network Indicators

NVM Ratio

Network Value to Metcalfe Ratio (NVM Ratio) is defined as the ratio of the log of market capitalization divided by the log of the square of daily active addresses in the specified window.

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Last updated 1 year ago

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Definition

Network Value to Metcalfe Ratio (NVM Ratio) is defined as the ratio of the log of market capitalization divided by the log of the square of daily active addresses in the specified window.

NVM Ratio=ln⁡(Market Cap)ln⁡(Daily Active Addresses2)\text{NVM Ratio} = \frac{\ln (\text{Market Cap})}{\ln (\text{Daily Active Addresses}^2)}NVM Ratio=ln(Daily Active Addresses2)ln(Market Cap)​

Interpretation

NVM Ratio evaluates the fair value of the blockchain network by applying where the law claims that the value of the network is proportional to the square of the number of active users.

  • High values : Overvalued network The network is overvalued by the interpretation where the price is too high compared to the low number of active addresses

  • Low values : Undervalued network The network is undervalued by the interpretation where the price is too low compared to the high number of active addresses

Use Case

RSI based market spotting

is one of the famous technical indicators measuring the relative strength of an upward trend and downward trend. We apply RSI to NVM for spotting the market's local tops and bottoms by thresholding. As you can see in the figure below, RSI of NVM quite correctly spots local tops and bottoms in a robust way.

The settings for this analysis are the followings:

  • We use a 7-day window for NVM for smoothing.

  • We use a 14-day window for RSI formulation.

  • We use 70% and 30% thresholds for the upper and lower thresholding.

Link to Our Data

📊
NVM in CryptoQuant Live Chart
NVM in CryptoQuant Data API Docs
Metcalfe's Law
Relative Strength Index (RSI)