Thank you for attending the lecture in Steemit-Crypto-Academy Season 4 & doing the homework task-3

The Realized Cap of any asset will increase when the participation of the public will increases

The Realized Cap of any asset will increase when the investors start selling the asset at a higher price.

In the beginning of the Bull run on the 25th of March, the Realized Cap of ETh was 71.5 B only after that it gradually started increasing with respect to the price and reached 112.95 B when ETH made a new all-time high.

Please note that Realized cap holds good with UTXO accounting structures. And ETH does not follow UTXO model, rather Accounting Model. So it would be ideal to study realized cap for UTXO based coins. For coins like ETH which follows the accounting model, more standardization is needed.

In the longer run till now the Realized Cap of ETH is still increasing gradually along with the price or without the price as well.

By and large for top ranked coins, the realized cap follows either a steep uptrend(bullish) or a shallow downtrend(bearish) or a flat contour(sideway).

In the last 3 months on 4th July the MVRV ratio was 126% after that it started creating LH LL and the price reached to $1700 as a bottom at that time the MVRV ratio was 73%. it reveres after making this low and made high of 200%. In this case, you can see how we identified the Bottom using MVRV ratio and top.

Just from LL and LH and MVRV reading you can not identify a bottom, unless the MVRV makes the first HH and HL, and a reading above 100%, you can not say that a bottom is in place.

MVRV Ratio in Trend prediction:

It is always better to identify the HH and HL in MVRV reading to identify the bullish trend. Simillarly, LL and LH to identify a bear trend. Also, always take numerical data to analyze it further.

How do I use MVRV to take a position?

First, always refer to the historical upper threshold of MVRV.

• MVRV is higher than 250%, or 300%, and formed a lower top- Sell signal
• MVRV lower than 100%, but the general trend is bullish(Price Action)- Buy signal
• MVRV lower than 100% with LH and LL- Extended bear market, accumulation zone(long term)

Also, the MVRV ratio can help us to get exit on the right time as a professor has discussed if MVRV ratio is 200% other it is considered as 2x profit zone and if it is 300% then it will be considered as 3x profit in the market so this is the area where we can start selling our bags.

Always take reference of historical upper thresholds.

Under what condition the Realized cap will produce a steep downtrend?

When the larger mass lose their confidence in the asset or when the buyer/investor will buy at top and sell at bottom.

Observation/Suggestion/Feedback:-

• The author has demonstrated & analyzed the on-chain metrics wrt price action of ETH both in the short term and long term. But we would suggest the author use a UTXO based coin for the use of the on-chain metrics such as Realized cap, MVRV, etc.
• The author has used Santiment to analyze the price trend in BTC wrt various on-chain metrics viz Realized Cap, MVRV, etc.
• Practical example using Block Explorer to explain the realized cap would have done justice to this Task.
• Better Quality of Analysis is required to portray a comprehensive understanding of the subject. Always include the numerical data when you correlate with the price. Always identify the trend with HH, HL, LL, LH and indicate them in the chart.
• One round of proof-reading is still required.
• Do not re-produce the same content from the course or from the others, always produce your own content.

Thank you.

Homework Task -3 successfully accomplished
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