MVRV - Market Value To Realized Value

Definition

MVRV (Market Value to Realized Value) ratio is defined as an asset's market capitalization divided by realized capitalization.

MVRV Ratio Overview

MVRV shows the ratio between the current price and the average price of every coin/token acquired. The more the ratio increases, the more people will be willing to sell as the potential profits increase. The value of MVRV gives an idea of how much overvalued or undervalued an asset is.

MVRV Indicator Explainer Video

How MVRV Measured

The MVRV Ratio is used as an on-chain indicator for the purpose of studying aggregate investor behaviors as price moves to/from their cost basis. It can be considered as a mean reversion style model, where the Realized Cap (aggregate market cost basis) functions as the mean and MVRV measures deviations from this mean.

The value of an asset’s given MVRV gives an idea of how much overvalued or undervalued an asset is based on short, mid, or long-term timeframes.

An MVRV value of 100% (or 2.0) means that if all holders sell their coins/tokens at the current price, they will generate a 100% (x2) profit on average. The more this ratio increases, the more likely traders have historically demonstrated their willingness to sell.

On the other side of the spectrum, a negative MVRV value indicates that the asset is "undervalued" on average. This means that if all coins were sold, most traders will be realizing losses at the asset’s current price.

MVRV values (regardless of which timeframe) will hover around 0%, assuming the asset has had enough time to normalize after its introduction as a publicly-traded asset.

Overall, MVRV shows the average profit/loss of all the coins currently in circulation given the current price.

We need to define two terms:

  • MV as in Market Value refers to the well-known capitalization. The second part is the
  • RV as in Realized Value. It is an alternative to the Market Value where instead of the current price, every coin/token is multiplied by its acquisition price.

The definition of MVRV is:

MVRV=MVRVMVRV = \frac{MV}{RV}

Usage Guide

The MVRV ratio allows traders to gauge both actual profitability vs. loss on the network, as well as gauge the inherent degree of fear and greed that comes with it. Assets have different extremes in terms of how far a positive or negative fluctuation in its MVRV can go. And if we measure the coin’s current MVRV vs. its lowest and highest points, it’s usually fair to make educated presumptions of when price tops and bottoms are forming.

MVRV Bitcoin chart

High MVRV Values ( > 2 )

MVRV value of 2 means that if all holders sell their coins/tokens at the current price, they will generate an x2 profit on average.

Low MVRV Values ( < 1 )

If the MVRV value is between 0 and 1, then the market is "undervalued" on average, meaning most people will realize losses if they all sell their holdings at the current price.

Timebound

Timebound Metrics available.

The timebound metrics can help exclude the inactive addresses. These metrics are computed the same way as the MVRV metric, with the only difference that they take into account only the coins/tokens that have moved in the desired time range. Examples: mvrv_usd_365d is computed on the coins/tokens that moved at least once in the past 365 days. mvrv_usd_60d is computed by taking only the coins/tokens that moved at least once in the past 60 days.

Comparing timebound MVRV values of different time ranges can clarify how much profit/loss long-term and short-term holders can realize.


Change Metrics

Change Metrics


MVRV Long/Short Difference

MVRV Long/Short Difference is defined as mvrv_usd_365d - mvrv_usd_60d

Negative values mean that short-term holders will realize higher profits than long-term holders if they sell at a price at this moment. Positive values show the opposite.

During strong and long bull runs, this metric tends to grow, and during bear markets it is decreasing. The rationale is that during strong bull runs, the long term holders are determining when the bull run will end when they start selling, while during bear markets, the long term holders are at a loss on average and the short term holders manage to realize profits


Access

Special Restrictions.


Measuring Unit

Ratio


Data Type

Timeseries Data


Frequency

All available assets have Daily Intervals A subset of the available assets that consists of some of the bigger assets have Five-Minute Intervals


Latency

On-Chain Latency


Available Assets

The daily interval MVRV metrics are available for these assets

The 5-minute MVRV metrics are available for these assets


SanAPI

The daily metrics are available under the mvrv_usd name under the mvrv_usd_<interval> name for the timebound metrics. The 5-minute interval metrics are available under the mvrv_usd_intraday name under the mvrv_usd_intraday_<interval> name for the timebound metrics.

Example of query for mvrv_usd:

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{
  getMetric(metric: "mvrv_usd") {
    timeseriesData(
      slug: "santiment"
      from: "2019-01-01T00:00:00Z"
      to: "2019-09-01T00:00:00Z"
      interval: "7d"
    ) {
      datetime
      value
    }
  }
}

Run in explorer

Example of query for mvrv_usd_intraday:

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{
  getMetric(metric: "mvrv_usd_intraday") {
    timeseriesData(
      slug: "bitcoin"
      from: "utc_now-90d"
      to: "utc_now-30d"
      interval: "3d"
    ) {
      datetime
      value
    }
  }
}

Run in explorer

Example of query for timebound MVRV:

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{
  getMetric(metric: "mvrv_usd_7d") {
    timeseriesData(
      slug: "santiment"
      from: "2019-01-01T00:00:00Z"
      to: "2019-09-01T00:00:00Z"
      interval: "7d"
    ) {
      datetime
      value
    }
  }
}

Run in explorer

Example of query for MVRV long-short difference:

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{
  getMetric(metric: "mvrv_long_short_diff_usd") {
    timeseriesData(
      slug: "santiment"
      from: "2019-01-01T00:00:00Z"
      to: "2019-09-01T00:00:00Z"
      interval: "7d"
    ) {
      datetime
      value
    }
  }
}

Run in explorer

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