On-chain Data Academy (8): A trap of a brand new, ARK-participated research on the magical pricing methodology of BTC! (III)

This article is the 8th article in the On-Chain Data Academy series, with a total of 10 articles. Take you step by step to understand on-chain data analysis, welcome interested readers to follow this series of articles. (Synopsis: On-Chain Data Academy (6): A New BTC Magic Pricing Methodology with ARK Participation (I) ) (Background Supplement: On-Chain Data Academy (7): A New BTC Magic Pricing Methodology with ARK Participation (II) ) TLDR Cointime Price series will be divided into three articles, this is the third It is highly recommended to read at least the first article in this series! This article will introduce another top observation method of Cointime Price Personal model sharing: Cointime Price distribution rate observation model A brief review of the content of the first two articles In the Cointime Price series of articles, the first one explains the basic principle of Cointime Price and gives an application of bottoming; The second part starts from the perspective of "the magnitude of the price deviation from Cointime Price", and shares the personally designed Cointime Price Deviation model with you, and uses this model as a signal filter at the top of the observation. If you are a first-time reader of this series of articles, it is recommended to have read at least the first article first, otherwise there is likely to be a lag in understanding in the follow-up. Top-Evading Application Methodology: Cointime Price Daily Distribution Rate Model First, the law of Cointime Price Before going on, let's take a look at the chart of Cointime Price: Careful readers should find that the change in Cointime Price actually has a full of obvious characteristics: "Sharp rise ⭢ Platform period ⭢ Sharp rise ⭢ Platform period ⭢ ..." According to the content of the first article in this series, we can know: "Cointime Price will only change quickly when long-term holders distribute a large number of times", and Cointime Price itself is equivalent to "the average cost of chip time weighted in the market", in the distribution stage, the remaining holders on the market because of the acceptance of distribution, resulting in higher costs, reflected in the chart will be the rapid rise of Cointime Price. Taking advantage of this feature, we designed an indicator to observe the distribution rate, and temporarily named it "Cointime Price Daily Distribution Rate". 2. Cointime Price Daily Distribution Rate Model To measure the rate of change, we use the simplest formula here: Daily distribution rate = (Today's Cointime Price – Yesterday's Cointime Price) / Today's Cointime Price The calculated value is then smoothed by the moving average. Writing this formula to Glassnode yields the following chart: We can see that every time a bull market leader rises, it must be accompanied by a high payout rate of Cointime Price. Except for one high distribution rate near the bottom in 2019, once there is a high distribution rate the rest of the time, it is a signal for long-term holders to accelerate distribution. As for the high distribution rate in 2019, in practice it will not make us misjudge, because at that time, even if you don't look at other indicators, you can know that it cannot be the "top" just by looking at the price. Third, the daily distribution rate at the top of history According to common sense, every time BTC appears at the cyclical big top, there is usually not only one distribution, whether from URPD, Realized Profit、... and other indicators can be seen. It also holds logical sense, because distribution is always a process, not an event that can be completed quickly. As you can see in the chart above, when you appear at the top, the daily distribution rate will increase significantly more than once. In this bull cycle, the daily distribution rate has accelerated once in March 2024, which can also be confirmed by Realized Profit's data, indicating that some long-term holders did take profits at that time. March 2024 is the first rapid increase in distribution rate in this round; In November of the same year, in the process of Trump's election and rapid price increase, the distribution rate once again showed a rapid increase. From the perspective of on-chain data analysis, this is undoubtedly a warning sign worth watching. Conclusion The above is all about the on-chain data academy (eight), and the sharing of the Cointime Price series has come to an end. Readers who are interested in learning more about on-chain data analysis, be sure to follow this series of articles! If you want to see more on-chain data analysis and teaching content, please follow my Twitter (X) account! Hope this article helps you, thanks for reading. Related stories On-Chain Data Academy (1): Do you know what the average cost of BTC in the whole market is? On-Chain Data Academy (II): How much does it cost for the Hodlers who are always making money? On-chain data academy (3): Have the makers at the bottom made profits? On-Chain Data Academy (VIII): A new set of exciting pricing methodologies for BTC with ARK research! (III) This article was first published in BlockTempo's "Dynamic Trend - The Most Influential Blockchain News Media".