A Framework For Valuing Bitcoin

The MVRV ratio is market capitalization divided by realized capitalization, which measures the price of bitcoin relative to the average on-chain cost basis of all participants in the market.A mean reversion metric, the MVTV ratio is market capitalization divided by thermo capitalization or the cumulative USD value paid to miners to secure the network.The RPV ratio is realized on-chain profits in USD divided by realized capitalization, measuring the difference between daily profit-taking behavior and buyers’ average cost basis.Another measure of price inefficiencies is the Short Term Holder (STH) Profit/Loss (P/L) ratio, which is the short-term supply of bitcoin at a profit divided by the short-term supply at a loss.