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The below is from a recent edition of the Deep Dive, Bitcoin Magazine’s premium markets newsletter. To be among the first to receive these insights and other on-chain bitcoin market analysis straight to your inbox, subscribe now.

A key on-chain metric that we’ve discussed before, and that we will cover today, is the Realized HODL (RHODL) Ratio. The ratio uses realized cap HODL waves, which takes the original HODL Wave metric and weights the UTXOs in each age band by their realized price. Specifically the Realized HODL Ratio uses the one-week and the one-to-two-years Realized Cap HODL Age bands.

For a more in-depth overview of this metric, check out The Daily Dive: HODL Waves And Realized HODL Ratio.

By using this metric, we can better understand what’s happening with younger coins versus older coins. As younger coins become more dominant and the ratio rises, long-term holders hold less of the realized market value. As the ratio falls, long-term holders hold more market-realized value compared to younger coins. An overheated market would show much higher younger coin dominance.

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