Net Unrealized Profit/Loss (NUPL)

Measures the difference between Market Cap and Realized Cap to identify market cycles and optimal entry/exit points

Net Unrealized Profit/Loss (NUPL)

Measures aggregate profit/loss of all Bitcoin holders - identifies market cycle tops and bottoms

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Positive values: Market in profit | Negative values: Market in loss

Euphoria Zone

> 0.60

Extreme profit - sell signal

Hope-Optimism Zone

0.00 - 0.50

Healthy bull market - hold

Capitulation Zone

< -0.25

Deep loss - buy signal

Understanding NUPL: NUPL measures the difference between Market Cap and Realized Cap. When positive, the market is in aggregate profit (bullish). When negative, the market is in aggregate loss (bearish). Values > 0.6 have historically marked cycle tops, while values < -0.25 have marked cycle bottoms.

NUPL Market Phases

Extreme Capitulation(< -0.50)

Capitulation(-0.50 - -0.25)

Fear(-0.25 - 0.00)

Hope(0.00 - 0.25)

Optimism(0.25 - 0.50)

Greed(0.50 - 0.60)

Euphoria(> 0.60)

Developed by

Glassnode

On-Chain Analysts

Metric Type

On-Chain

Profit/Loss

Best For

Cycle Timing

Multi-Month

Track Record

2011+

Multiple Cycles

Historical Accuracy: NUPL has successfully identified every major Bitcoin cycle top (Dec 2017, Apr 2021) when exceeding 0.6, and every major bottom (Dec 2018, Nov 2022) when dropping below -0.25. The metric combines price with on-chain holder cost basis, making it more robust than price-only indicators.

On-Chain Analysis: Market cycle indicator based on unrealized profit and loss

Understanding NUPL

Net Unrealized Profit/Loss (NUPL) is a powerful on-chain metric that measures the overall profit or loss of all Bitcoin holders. It calculates the difference between Market Cap (current price × supply) and Realized Cap (price when each coin last moved), normalized by Market Cap. This gives us insight into whether the market is in profit or loss overall.

The formula is: NUPL = (Market Cap - Realized Cap) / Market Cap. Values range from approximately -0.6 (extreme loss) to 0.75 (extreme profit). When NUPL is high, most holders are sitting on unrealized profits, indicating euphoria and potential top. When NUPL is low or negative, most holders are at a loss, indicating fear and potential bottom.

Created by Rafael Schultze-Kraft and the Glassnode team, NUPL has proven remarkably accurate at identifying Bitcoin market cycle phases. It combines price action with on-chain holder behavior, making it more robust than price-only indicators. The metric has successfully marked major cycle tops (Dec 2017, Apr 2021) and bottoms (Dec 2018, Nov 2022).

Key Features:

• Market Cycle Identification: Seven distinct phases from Extreme Capitulation to Euphoria help identify market position.
• Top & Bottom Signals: NUPL > 0.6 signals tops, NUPL < -0.25 signals bottoms with high accuracy.
• Real-Time Sentiment: Tracks aggregate profit/loss of all holders, providing market-wide sentiment.
• Multi-Cycle Validation: Proven effective across multiple Bitcoin cycles since 2011.

How to Use NUPL

For Selling Strategy:

When NUPL exceeds 0.6 (Euphoria), the market is in extreme profit. This has historically marked cycle tops. Consider taking profits or reducing exposure. NUPL > 0.5 (Greed) also warrants caution and partial profit taking.

For Buying Strategy:

When NUPL is below 0 (Fear) or especially below -0.25 (Capitulation), the market is in loss. These zones have historically provided excellent buying opportunities. NUPL < -0.5 marks extreme capitulation - the best time to accumulate.

For Holding Strategy:

NUPL between 0 and 0.5 (Hope to Optimism) represents healthy bull market conditions. These are hold zones where neither aggressive buying nor selling is warranted. Let positions run during these phases.

Combined Analysis:

Use NUPL with other indicators like MVRV Z-Score, RHODL Ratio, and price action for confirmation. When multiple on-chain metrics align, conviction in signals increases significantly.

Pro Tips:

• NUPL > 0.6 = Euphoria = Strong sell signal (cycle tops)
• NUPL 0.5-0.6 = Greed = Take partial profits
• NUPL 0.25-0.5 = Optimism = Healthy bull, hold
• NUPL 0-0.25 = Hope = Early bull, accumulate
• NUPL -0.25-0 = Fear = Good buying opportunity
• NUPL < -0.25 = Capitulation = Excellent buying opportunity
• NUPL < -0.5 = Extreme Capitulation = Best buying opportunity
• Combine with volume and momentum for confirmation
• Best for multi-month position sizing decisions
• Historical zones remain remarkably consistent

Calculation Methodology

NUPL is calculated using two key metrics: Market Cap (current price × circulating supply) and Realized Cap (sum of price when each UTXO last moved). The difference between these, normalized by Market Cap, gives the net unrealized profit or loss. Positive NUPL means the network is in aggregate profit, negative means aggregate loss. The metric was developed by Glassnode and has become a standard tool in on-chain analysis for identifying market cycles.

-0.6 to 0.75

Value Range

Market Phases

2011+

Track Record

Net Unrealized Profit/Loss (NUPL)