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Decred Relative BTC Realised Cap and MVRV Ratio

Jun 25, 2021 MVRV Ratio = 0.00
Updated Jun 25, 2021
Chart Hints: MVRV below 0,7 indicates a BUY ZONE as the Market Cap is undervalued compare with the Realised value.

Chart Brief

The Relative Realised Caps present a series of pricing models derived from both spot prices and onchain signatures of the DCR/BTC exchange pair. The following realised valuation models are denominated in BTC and attempt to capture a range of methods for valuing across volatile assets of different size, scale and liquidity.

Realised Cap (BTC) - Traditional method for realised cap, pricing each Decred UTXO at the BTC value when it was last spent.

Relative On-chain Cap (BTC) - Ratio between DCR Realised Cap and Bitcoin Realised Cap giving a relative on-chain pricing model. This metric tends to act as a support level, or lower bound pricing band. When the Decred Realised Cap (numerator) appreciates in price or experiences increased transaction momentum compared to Bitcoin, the pricing metric will increase. Conversely, where the Bitcoin Realised Cap (denominator) appreciates, or where Decred sells off relative to Bitcoin, the metric will shed value.

Relative MVRV Cap (BTC) - Presents the DCR/BTC value where the ratio of Decred is equal to the MVRV Ratio of BTC. This is the price at which both coins are trading an equal premium or discount relative to their respective Realised Cap. This model tends to act as an upper bound pricing band which on contact, can be interpreted as the point where Decred has amplified the returns of a BTC only position.

Mid Relative Realised Cap - The midpoint between the Relative On-chain Cap and the Relative MVRV Cap. This metric, by design, captures a mean pricing level and can be used as a support or resistance signal in all market cycles.

The Realtive MVRV Ratio Oscillator presents is a representation of the relative premium or discount between Decred and Bitcoin. High oscillator values signal that both coins are trading at a premium and Decred has provided amplified returns over a BTC only position and may singal overvaluation. Conversely, low values signify that DCR has lost value relative to BTC and may signal undervaluation.

Data Source: Coinmetrics.io and explorer.dcrdata.org.