Get started with Glassnode Metrics


Welcome to Glassnode Studio's Onchain Analysis guide. If you're taking your first steps or looking for a refresher, here are three key metrics to master first. Familiarizing yourself with these foundational metrics not only primes you for a deeper dive into Glassnode Studio but also unlocks the potential to explore numerous other facets of the product.

1. SOPR (Spent Output Profit Ratio)

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Imagine every time you sell or trade a Bitcoin, it comes with a virtual "tag" indicating whether you made a profit or loss at that exact moment, based on the original price you bought it at. The SOPR metric is like a market-wide aggregate of all these "tags". It gives us a snapshot of the overall profit or loss of all Bitcoin transactions in a given time period (1 Day / 1 Hour).

Core Concept:

  • Spent Output: When you spend (or sell) Bitcoin, the amount you're disposing of is what we term as a "spent output".

  • Profit Ratio: This measures if, on average, people are selling their Bitcoin at a profit (above the price they bought it at) or at a loss.

Breaking Down SOPR:

  1. SOPR Value = 1: This is the break-even point. If SOPR is 1, it means that on average, people are selling their Bitcoin for the exact price they bought it.

  2. SOPR > 1: People are, on average, selling their Bitcoin at a profit. The higher the value above 1, the larger the average profit of the entire market.

  3. SOPR < 1: People are selling their Bitcoin at a loss.

Why SOPR Matters for Traders:

  1. Market Sentiment Gauge: SOPR can be used as an indicator of overall market sentiment. If SOPR is consistently above 1 during a bullish phase, it could suggest that the sentiment remains positive as most traders are still taking profits. Conversely, if it drops below 1 in a bearish market, it might imply panic selling or capitulation.

  2. Potential Buy/Sell Signals: While SOPR shouldn't be used in isolation, extreme values can indicate potential overbought or oversold conditions. For instance:

    • A significantly high SOPR during a rapid price increase might suggest euphoria and potential overextension of the rally.

    • A dropping SOPR in a downtrend could signify potential market bottoms as traders sell at a loss.

  3. Resetting SOPR:

    • If SOPR values drop towards 1 during a bull market, it might indicate a potential reset or consolidation phase where weak hands are being shaken out, and could be interpreted as a buying opportunity.

    • If SOPR values gravitate towards 1 during a bear market, it might indicate a stabilization or potential bottoming phase where panic selling is subsiding. This could be interpreted as a sign that the market is reaching an equilibrium, where sellers are no longer selling at a loss, possibly signaling a reversal or at least a pause in the downward trend.

2. MVRV (Market Value to Realized Value)

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Imagine you could measure the current value of all Bitcoin against the price at which each Bitcoin last moved (i.e., when it was last bought or sold). MVRV captures this dynamic, offering insight into the perceived value of Bitcoin compared to its "realized" value.

Core Concept:

  • Market Value: The total value of all Bitcoin in circulation at current prices.

  • Realized Value: The cumulative value of all Bitcoin based on the prices they were last transacted.

Breaking Down MVRV from a Profit/Loss Perspective:

  1. MVRV Value = 1: The market is at a break-even point. On average, holders are neither in profit nor in loss, as the current market value aligns with the price they paid.

  2. MVRV > 1:

    • Profit Zone: The market value of Bitcoin is higher than the prices at which they were last acquired, indicating that most holders are in profit.

    • Incentive to Sell: The higher the MVRV moves above 1, the greater the unrealized profit in the market, suggesting a potential increase in selling or spending behavior by holders.

  3. MVRV < 1:

    • Loss Zone: The market value of Bitcoin is lower than the prices at which coins were last acquired, indicating that a significant portion of holders are at a loss.

    • Capitulation & Accumulation: Extended periods with MVRV below 1 are uncommon and signify notable distress in the market. These phases can lead to capitulation, but they also represent potential accumulation opportunities for discerning investors.

Why MVRV Matters for Traders:

  1. Spotting Market Extremes: MVRV can serve as a tool to identify overbought or oversold conditions, especially in correlation with historical MVRV levels.

  2. Bear Market Dynamics: An MVRV below 1 is an indicator of market distress and can also be a potential accumulation point for forward-looking investors.

  3. Profit-Taking Indicators: A rising MVRV, especially during bull runs, can indicate zones where profit-taking is more likely.

3. HODL Waves

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When thinking about Bitcoin's value and long-term potential, it's not just about current market value and realized profits. How long investors and traders have been holding onto their Bitcoin can provide insightful information about market sentiment. This is where HODL Waves come into play.

Core Concept:

  • HODL Waves: A visual representation of the age distribution of Bitcoin UTXOs (unspent transaction outputs) in the market. Essentially, it shows for how long Bitcoin has been held in individual wallets before being spent.

Breaking Down HODL Waves:

  1. Short-Term Waves: Represents Bitcoin that has been held for a short period, e.g., less than a month. This can reflect recent buying activity or traders looking for short-term profits.

  2. Mid-Term Waves: These represent Bitcoin held for several months to a year. A rise in this category might signify increasing investor confidence, with holders showing commitment despite short-term price fluctuations.

  3. Long-Term Waves: Shows Bitcoin that hasn't moved for years. An increase here indicates strong belief in Bitcoin's long-term value, with holders unlikely to sell in the near future.

Why HODL Waves Matter for Traders:

  1. Market Sentiment Gauge: A shift from short-term to long-term holding can indicate growing confidence in the market's future. Conversely, a shift from long-term to short-term can suggest potential selling pressure.

  2. Spotting Potential Supply Changes: If a significant portion of long-held Bitcoin starts moving, it can indicate a potential increase in supply in the market, which might exert downward price pressure.

  3. Historical Comparisons: By comparing current HODL Waves to past cycles, traders can identify patterns that might indicate upcoming market movements.


Understanding and harnessing the power of onchain metrics can provide traders with invaluable insights into the underlying health and sentiment of the Bitcoin market. Glassnode Studio is committed to offering the most pertinent and actionable onchain data for institutional trading firms to aid in informed decision-making. By combining these onchain insights with your traditional technical and fundamental analyses, you can achieve a more comprehensive view of the market landscape.

Happy trading!

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