According to Santiment's data, cryptocurrency prices were more dispersed and uncorrelated in April compared to previous months.
This means that some coins outperform others based on their fundamentals, market sentiment and technical factors.
One way to calculate the relative value of different cryptocurrencies is to use the MVRV (market value-realized value) ratio, an on-chain indicator that measures the price of an asset on an average on-chain cost basis.
The MVRV ratio is a way to compare how much cryptocurrencies are worth. It looks at the current price of a cryptocurrency and compares it to how much people pay on average for that coin.
The MVRV rate can help us see if a cryptocurrency is too expensive or too cheap compared to its regular price. The regular price is the average cost of all coins for this coin in the market. The MVRV rate tells us how far the current price is from the regular price.
📊 Prices have been more scattered and non-correlated to one another here in April than in previous months. And our MVRV model confirms average trading returns appear as historically good times to buy for some ( $OMG, $SRM, $VIDT), and quite risky for others ( $BEL, $INJ, $RNDR). pic.twitter.com/g6z1IAfySz
— Santiment (@santimentfeed) April 28, 2023
A high MVRV ratio indicates that the market value of an asset is too high relative to its realization value, meaning that investors are holding on to unrealized profits and may be inclined to sell.
A low MVRV ratio indicates that an asset's market value is below its realization value, meaning that investors hold unrealized losses and may be tempted to buy.
Santiment says the MVRV model shows that some coins have low MVRV rates and are cheaper than their average cost, such as OMG Network (OMG), Serum (SRM), and V-ID (VIDT).
Other coins such as Bella Protocol (BEL), Injective Protocol (INJ), and Render Token (RNDR) have higher MVRV rates and are more expensive than their average cost, according to Santiment. According to Santiment, these coins currently seem risky.
*Not investment advice.