On-Chain Analysis Guide
Unlock the power of blockchain data to understand market trends and investor behavior. Learn to analyze on-chain metrics for better cryptocurrency investment decisions.
What is On-Chain Analysis?
On-chain analysis involves examining data directly from blockchain networks to understand market dynamics, investor behavior, and network health. Unlike traditional financial markets, blockchain networks provide unprecedented transparency into transaction flows, holder behavior, and network usage patterns.
This analysis can reveal market cycles, identify accumulation and distribution phases, and provide early signals for potential price movements based on actual network activity rather than just price and volume data.
Key On-Chain Metrics
Network Activity Metrics
Active Addresses
Number of unique addresses participating in transactions daily.
Transaction Count
Total number of transactions processed on the network.
Transaction Volume
Total value transferred on the network in USD.
Hash Rate
Computational power securing the network (PoW chains).
Holder Behavior Metrics
HODL Waves
Distribution of coins by how long they've been held without moving.
Coin Days Destroyed (CDD)
Measures when old coins move. High CDD indicates long-term holders selling.
Exchange Flow Analysis
Tracking cryptocurrency flows to and from exchanges provides insights into market sentiment and potential price movements.
Exchange Inflows
Cryptocurrency moving from wallets to exchanges, often indicating selling pressure.
Exchange Reserves
Total amount of cryptocurrency held on exchanges.
Exchange Outflows
Cryptocurrency moving from exchanges to wallets, indicating accumulation.
Net Flow
Difference between inflows and outflows.
Valuation Metrics
MVRV Ratio
Market Value to Realized Value ratio compares current market cap to realized cap (price when coins last moved).
Network Value to Transactions (NVT)
Often called the "P/E ratio of crypto," NVT compares network value to transaction volume.
Low NVT = Network may be undervalued relative to utility
Realized Price
Average price at which all coins in circulation were last moved, weighted by amount.
Advanced On-Chain Indicators
Spent Output Profit Ratio (SOPR)
Ratio of realized profit/loss for all coins moved on-chain.
SOPR < 1 = Losses being realized
Puell Multiple
Daily mining revenue vs 365-day moving average.
Low values = Potential market bottoms
Stock-to-Flow Model
Ratio of existing supply to new production rate.
Used for long-term valuation
Whale Activity
Tracking large holder (whale) accumulation and distribution.
Whale distribution = Bearish signal
Long-Term Holder Supply
Percentage of supply held by addresses inactive for 155+ days.
Decreasing LTH supply = Distribution
Funding Rates
Cost of holding leveraged positions in derivatives markets.
High negative = Excessive bearishness
On-Chain Analysis Tools
Free Tools
- • Glassnode Studio (limited free tier)
- • CoinMetrics Community
- • Blockchain.info
- • Messari.io
- • CryptoQuant (basic)
Premium Tools
- • Glassnode Pro
- • CryptoQuant Pro
- • Santiment
- • IntoTheBlock
- • Nansen
Complete Your Market Analysis Skills
Combine on-chain analysis with fundamental analysis and market indicators for comprehensive market understanding.