On-chain metrics analysis: NUPL, Puell Multiple, MVRV

Hero by Satan Follow Follow 3 min read · Jul 29, 2026 · 0 views

The Foundation of On-Chain Analysis in Crypto

Unlike traditional financial markets, where internal corporate activity is hidden behind quarterly reports, the blockchain offers unprecedented transparency. On-chain analysis allows professional trade

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rs to look under the hood of the market by tracking real capital flows, the behavior of long-term holders, and the financial health of miners. In a high-volatility environment, using fundamental indicators like NUPL, Puell Multiple, and MVRV is not just an advantage; it is a necessity for a deep understanding of market cycles. These metrics help filter out market noise and identify global trend reversal points with high mathematical precision.

The MVRV Ratio and Finding Fair Value

The MVRV (Market Value to Realized Value) ratio is one of the most reliable indicators for identifying global market extremes. It is calculated as the ratio of market capitalization to realized capitalization. Realized value reflects the aggregate price at which every asset last moved on-chain, effectively representing the cost basis for all market participants. When the MVRV value rises above 3.0, it signals significant unrealized profit, which has historically preceded the formation of a market top. Conversely, values below 1.0 indicate that the market price has fallen below the average purchase price of the majority of holders. This state of deep undervaluation and capitulation often represents an ideal entry point for long-term positions. For more precise analysis, professionals use the MVRV Z-Score, which standardizes data and clearly highlights zones of anomalous deviation from the mean.

Cycle Psychology Through the Lens of NUPL

The NUPL (Net Unrealized Profit/Loss) metric translates dry blockchain data into the language of human emotion. It displays the difference between relative unrealized profit and loss. Visually, the NUPL chart is divided into zones corresponding to psychological market stages: from capitulation and hope to belief and euphoria. When the indicator is in the negative zone, the market is in a state of fear and panic, typical of a bear market bottom. A transition into the Euphoria zone (above 0.75) signifies that the vast majority of participants are in profit, making the risk of mass profit-taking critical. Using NUPL allows traders to remain objective when the crowd succumbs to herd mentality, providing a clear signal as to whether an asset is in an accumulation or distribution phase.

Miner Impact and the Puell Multiple

Miners are a fundamental force in the Proof-of-Work ecosystem, acting as natural sellers forced to cover operational expenses. The Puell Multiple indicator analyzes the ratio of the daily value of minted coins to the 365-day moving average of that value. Low Puell Multiple values (below 0.5) indicate that miner revenue is significantly lower than the annual average. This often leads to miner capitulation, where weak players exit the market and selling pressure reaches its minimum. Historically, these periods coincide with the formation of a long-term price floor. High values (above 4.0), however, point to excessive mining profitability, which incentivizes active selling and creates strong resistance for further price growth.