This narrows Market Value to Realised Value to coin that has been sat on for a long time, which reports how far the Long-Term Holder cohort is from what it originally handed over. Their purchase price sits far beneath the market’s and shifts at a glacial pace.

That slowness is exactly why the cohort deserves a figure of its own. An identical price produces a completely different position for somebody who bought years ago than for somebody who bought last month, and one combined number blurs the two together.

What it actually measures

Through most of a cycle this group is comfortably ahead, and the extent of it is the reading. A patient cohort sitting on an enormous unrealised gain is the single largest reservoir of potential supply anywhere in the market.

The upper end of the range has come before distribution for that reason. The gain does not cause the selling, but nothing else assembles a store of temptation on that scale.

Movement here is slow enough to be trusted. The cohort accumulates gradually and parts with coin reluctantly, so a change in this figure describes something that has genuinely happened rather than a week of noise.

A reading beneath break-even has been almost unheard of

For this group to be behind, price has to fall through everything they paid, and they paid it across years the market has since spent trading above. The bar is therefore extraordinarily high and it has been cleared only a handful of times.

That rarity cuts both ways. Such readings carry unusual weight when they arrive, and they are useless as a routine tool, because something appearing a handful of times per decade cannot be built into a process.

LTH MVRV Z-Score: a shared threshold would suit neither cohort

The edges are the entire point. Everywhere in between, this group is comfortable, which is how it spends most of its existence and tells a reader nothing, and the information lives in the rare spells when it is not.

The temptation with a family of related measures is to judge them all against one line, because a single line is easier to remember and easier to talk about. Here it would be useless.

The patient cohort and the recent one live in different numerical neighbourhoods, so any level chosen would be an emergency for one and an irrelevance for the other. Giving each its own reference costs a little simplicity and buys a reading that means the same thing in both places.

What it does not tell you

The cohort boundary is a convention. Where the line between patient and recent supply is drawn changes who is counted, and reasonable people draw it in different places.

Age belongs to coin rather than to people. Somebody who has held for years but reorganised their storage last week drops out of this cohort entirely, which understates how much patient supply is really there.

A large unrealised gain is a temptation and not a plan. This group has sat through enormous gains without acting on any of them, which is precisely how it became this group.

How to read it

Euphoria. The patient cohort is sitting on a gain at the very top of what it has ever carried.

Elevated. Long-held coin is comfortably ahead, with a substantial reservoir of unrealised gain behind it.

Fair. The patient cohort is priced near what it originally handed over.

Discount. Long-held coin has gone behind, which takes a decline through years of accumulated cost.

Deep value. The patient cohort is deeply behind, a condition seen only a handful of times.

Open the Profit & Loss dashboard and LTH MVRV sits there with Unrealised Profit, Active MVRV and Who is Spending.

Common questions

Why give this cohort its own figure?

Because what they paid sits a long way beneath the market and shifts at a crawl. An identical price therefore leaves them somewhere entirely different from somebody who bought last month.

What does the upper end describe?

A patient group sitting on an enormous unrealised gain. That is the largest reservoir of potential supply anywhere in the market, which is one reason the upper end has come before distribution.

How rare is a reading beneath break-even?

Extraordinarily. It takes a decline through everything this group paid across years the market has since traded above, and it has been cleared only a handful of times.

Does a large gain mean they will sell?

No. This group has sat through enormous gains without acting on any of them, which is precisely how it became this group. The gain is a temptation and not a plan.

Can somebody patient drop out of the cohort?

Easily. Age belongs to coin, so a holder of many years who reorganised their storage last week leaves entirely, which understates how much patient supply exists.

Why does this cohort need its own yardstick?

Because it operates in an entirely different numerical neighbourhood from the market at large. Any line borrowed from the broader figure would either shout every day or stay silent for ever.

Does the yardstick shift?

Constantly, since it is built out of history and history keeps accumulating. What looked exceptional in an earlier era can register as fairly ordinary now, unchanged in itself.