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Declining NVT Ratio Suggests Bitcoin could be a Value Buy

Apr 12, 2019

 

  • This our inaugural Bitcoin sentiment post, where every day, we will look at the factors driving sentiment for Bitcoin (BTC).
  • An important fact that stands out to us is the decline in the Network Value to Transaction (NVT) ratio
  • We look at the NVT as an implied P/E for Bitcoin and apply a 10-day exponential weighted moving average
  • A declining NVT would suggest that valuations for Bitcoin have not caught up with its usage
  • Overall Sentiment for Bitcoin has recently declined, whether it be the overall social sentiment score or average article sentiment
  • What we find interesting is that an improvement in the 30-day sentiment in early April preceded the recent pop in Bitcoin above $5k

Bitcoin (BTC) Article Count

Bitcoin Article Count Chart

Overall Bitcoin (BTC) Social Sentiment 

Overall Bitcoin Social Sentiment Chart

Average Bitcoin (BTC) Article Sentiment

Average Bitcoin Article Sentiment Chart

Bitcoin (BTC) Google Trends

Google Trends Chart

Bitcoin (BTC) Network Value to Transaction Ratio - 10-Day EWMA

Network Value to Transaction - 10-Day EWMA

Bitcoin (BTC) Volume

Bitcoin Volume Chart