What is NUPL?
Ever wondered if there’s a crystal ball for Bitcoin market sentiment?
Well, say hello to NUPL (Net Unrealized Profit/Loss), the metric that’s got everyone talking.
In this guide, we’ll lift the lid on NUPL and why it’s a big deal in the crypto world.
What’s NUPL All About?
NUPL, or Net Unrealized Profit/Loss, is like taking Bitcoin’s temperature.
It looks at the difference between unrealized profit and loss across the entire network.
In plain English?
It tells us if Bitcoin hodlers are sitting pretty on profits or feeling the pinch.
Here’s why it matters:
- High NUPL: Lots of folks are in profit. They might be itching to sell.
- Low NUPL: Could be a buying opportunity. The market might be oversold.
Crunching the Numbers
The NUPL formula is pretty straightforward:
NUPL = (Market Cap - Realized Cap) / Market Cap
Let’s break it down:
- Market Cap: Current Bitcoin price × Total supply
- Realized Cap: The price of each Bitcoin when it last moved, all added up
Positive NUPL? The market’s in the green.
Negative? We’re in the red.