What does realised value claim to know about cost basis?

Market capitalisation has an old problem: it applies the price of the last marginal trade to every unit in existence, including units that have not moved in a decade and may never move again. On-chain data offers an alternative accounting, and it is one of the more genuinely interesting objects in this market — provided you also know what it cannot see.

Realised capitalisation

Value every coin at the price on the day it last moved on-chain, then add them up.

Formally, for a UTXO chain: sum over all unspent outputs of (amount × the asset's price at the block that created that output). Instead of one price applied to all supply, you get a supply-weighted average of the prices at which supply last changed hands on-chain.

Worked: a three-coin economy

• Coin A last moved when the price was $10,000
• Coin B last moved at $30,000
• Coin C last moved at $60,000

Realised cap = 10,000 + 30,000 + 60,000 = $100,000

The current price is $50,000, so market cap = 3 × 50,000 = $150,000.

MVRV = market cap ÷ realised cap = 150,000 ÷ 100,000 = 1.5.

The aggregate on-chain cost basis is covered 1.5 times at current prices. Coin C, last moved at $60,000, is below its basis; coins A and B are above theirs. The ratio is an aggregate accounting statement about the whole supply.

A close relative is coin-days destroyed = coins moved × days since they last moved. One coin dormant for five years destroys 1,825 coin-days; one coin moved yesterday destroys 1. It weights movement by dormancy, so it distinguishes long-held supply changing hands from short-term churn.

Five things it cannot see

1. Self-transfers reset the basis. Move coins between your own wallets and the metric records a fresh "last moved" price at today's level. Custody migrations, wallet upgrades and routine address rotation re-price coins that were never sold by anyone.

2. Exchange-held coins have a frozen basis. A coin deposited to an exchange three years ago may have been bought and sold two hundred times inside that exchange's database since. On-chain, its basis is still the deposit date. The most actively traded supply has the least accurate cost basis in the entire dataset.

3. Lost coins never leave. Provably or probably lost supply — including large, ancient, never-moved holdings — is valued at its ancient price and sits permanently in the denominator.

4. Wash and churn activity inflates recent buckets. Anything that moves coins for reasons unrelated to ownership change re-prices them to today.

5. It requires transparency. The metric exists only for chains with fully visible transfer histories. It cannot be computed for privacy chains or for anything whose supply sits in an opaque ledger — which includes every asset in the rest of this Academy.

Reading it like a professional

Realised value is a new accounting object with an unmeasurable error term. That combination — genuinely novel, genuinely uncertain — is exactly how it should be held: interesting, comparable to its own history on the same chain, and never used as an instruction. Anyone quoting an MVRV threshold as a decision rule is asserting a precision the underlying data cannot support.

This is a description of a measurement. It is not a signal and nothing here is advice.

Try it now

1. Take a free MVRV series for bitcoin covering at least three years: Coin Metrics' community dataset on GitHub (coinmetrics/data, csv/btc.csv) carries it daily as CapMVRVCur. Realised cap is market cap (CapMrktCurUSD, same file) divided by MVRV.
2. The same asset's price over five years is below. Find the single largest jump in your realised-cap series and check what the price did on that exact day.

3. If the price did not move at all, you have almost certainly found a large custody migration re-pricing dormant supply — limitation number one, visible in the data. Measure that day on the chart to prove to yourself how little happened, and write one sentence on what the metric therefore does and does not know about anybody's cost basis.