Tag Archives: NVT Ratio

Bitcoin In A Bubble? Check The NVT Ratio

Is Bitcoin In A Bubble? Check The NVT Ratio

Could this be a useful ration to check for valuation

https://www.forbes.com/sites/wwoo/2017/09/29/is-bitcoin-in-a-bubble-check-the-nvt-ratio/#d994f376a23f

A comment on my Telegram chart group about this:

…he only problem I can see with the NVT ratio is that daily transaction value becomes a worse proxy for earnings as Bitcoin becomes less of a payment network (and more of a value storing mechanism). Having said that, it seems to do a pretty good job. Let me put it this way; I wouldn’t liquidate my BTC holdings on account of a high NVT ratio, but I might take it into consideration as part of a wider analysis.

So I suppose it depends on how you view Bitcoin as to whether or not the NVT ratio is useful; whether you foresee Bitcoin to be the currency of the future, or more like digital gold.

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