The Activity-to-Vaulting Ratio describes the macro scale balance between coin 'activity' and 'inactivity' in a Cointime Economics framework. It is calculated by taking the ratio between Liveliness and Vaultedness.

A2VR provides a more sensitive view on shifts in coin owner behaviour than Liveliness, however retains a similar interpretation framework:

• Uptrends signal that aggregate coinblock destruction is greater than aggregate coinblock creation. This is typical of bullish markets as older coins are liquidated for profit, but also during periods of high volatility and panic such as major sell-off events.

• Downtrends signal that aggregate coinblock creation is greater than aggregate coinblock destruction. This is typical of bearish markets, when longer-term investors accumulate and HODL at elevated rates (e.g., due to increasing demand for Bitcoin as a store-of-value asset).

• Steepness of the metric signals the relative magnitude of the above two points. Steeper uptrends indicate more aggressive coinblock destruction, whilst steeper downtrends signal the converse, that the coin supply is increasingly dormant.

The A2VR metric can be considered as a weighting function, or multiplier, useful for calculations where analysts seek to discount the influence of dormant, inactive coins and amplify the influence of more mobile and active supply.

Coined By

This metric was developed within the Cointime Economics framework for Bitcoin. This project was a joint venture between Glassnode and ARK Invest, with full details available in two formats: an overview primer (Version I published via ARK) and a comprehensive guide for specialists (Version II published via Glassnode).