Realized Cap HODL Waves

Overview

This pillar analyzes the age distribution of coin supply, weighted by the price at which coins last moved. It provides a powerful view into the behavior of long-term holders versus short-term speculators, helping to identify market cycle tops and bottoms.

What It Does

Realized Cap HODL Waves segment the entire coin supply into age bands, such as 1-week, 6-months, or 2-years. It then calculates the 'realized value' for each band, effectively showing how much capital is stored within different investor age groups. This visualization reveals whether old, experienced hands are accumulating or if new, speculative money is flooding the market.

Why It Matters

This pillar offers a clear signal of market health by tracking the conviction of long-term investors. An expansion of older coin bands indicates strong holding behavior and accumulation, often preceding major bull runs. Conversely, a spike in young coin bands suggests profit-taking and can act as a leading indicator for market tops.

How It Works

The analysis begins by scanning the blockchain to identify the age of every Unspent Transaction Output (UTXO). These UTXOs are then grouped into predefined age cohorts. For each cohort, we calculate its Realized Cap, which is the sum of each UTXO's value at the time it was created. The final output is a chart showing the percentage of the total Realized Cap held by each age group over time.

Methodology

The core calculation is the Realized Cap for a specific age band 'i', defined as Σ(UTXO_size * Price_at_creation) for all UTXOs in band 'i'. Common age bands include <24h, 1d-1w, 1w-1m, 1m-3m, 3m-6m, 6m-12m, 1y-2y, 2y-3y, 3y-5y, and >5y. The final HODL Wave chart visualizes the relative thickness of these bands as a percentage of the total Realized Cap over time.

Edge & Advantage

It cuts through the noise of daily price action to reveal the underlying economic behavior of market participants, providing a clearer, longer-term signal than most technical indicators.

Key Indicators

• HODL Waves

  high

  The primary visualization showing the distribution of realized value across different coin age bands.

• Long-Term Holder (LTH) Supply

  high

  The percentage of circulating supply held by entities for over 155 days, indicating strong conviction.

• Short-Term Holder (STH) Supply

  medium

  The percentage of supply held for less than 155 days, representing more speculative capital.

Data Sources

• Glassnode

  A leading on-chain market intelligence platform that provides detailed HODL Wave charts.

• CryptoQuant

  An on-chain data analytics provider offering various metrics on investor behavior.

• LookIntoBitcoin

  Provides free-to-access charts for several on-chain metrics, including HODL Waves.

Example Questions This Pillar Answers

• → Will Bitcoin's price reach a new all-time high in the next 18 months?
• → Will the percentage of Bitcoin supply held by long-term holders fall below 60% before year-end?
• → Will Ethereum enter a bear market, defined as a 50% drawdown from its peak, within the next 12 months?

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