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Token Balance Ratio Distribution by Average Cost

Overview

Token Balance Ratio Distribution by Average Cost categorizes wallets based on their average acquisition cost and displays the percentage of total token supply held within each cost tier. This visualization shows how token ownership is proportionally distributed across different entry price levels, revealing which cost basis levels control what percentage of the total supply.

Definition

This indicator divides wallet addresses into a specified number of tiers based on their average acquisition cost, then calculates what percentage of the total token supply is held within each tier as of a user-specified date. The results are displayed as a bar chart showing how token ownership percentage is distributed across the cost basis spectrum.

Example

apu-avgcost-pbv

Significance

  • Supply Percentage Concentration: Reveals which cost basis levels control what portion of the total supply
  • Proportional Distribution Mapping: Shows relative token ownership across entry prices
  • Ownership Influence Analysis: For governance tokens, indicates relative voting power by cost basis
  • Normalized Supply Insights: Provides standardized visibility into supply distribution regardless of token quantity

Calculation Method

The indicator processes: 1. All addresses holding the token as of the specified date 2. Divides these addresses into the number of tiers specified by the "Number of Tiers" parameter based on their average acquisition cost 3. Calculates the percentage of total supply (tokens in tier ÷ total supply × 100%) held by addresses in each cost tier 4. Displays results as a horizontal bar chart with acquisition cost tiers on the y-axis and percentage of supply on the x-axis

Interpretation

  • Tall Bars: Indicate significant percentage of supply concentrated at specific cost levels
  • Percentage Clustering: High percentages in certain ranges shows where most ownership is concentrated
  • Distribution Pattern: Shows whether token ownership is evenly spread or concentrated
  • Influence-Weighted Support: Tiers with high percentage of supply often have greater market influence

Analysis Applications

  • Supply Control Analysis: Identify cost levels where significant supply percentage exists
  • Token Concentration Assessment: Visualize whether ownership is democratized or concentrated
  • Governance Power Distribution: Map where voting influence is concentrated by entry price
  • Proportional Risk Evaluation: Assess potential impact if certain cost tiers begin selling

Considerations

  • Normalizes the data to percentages, enabling easier comparison across different tokens
  • More meaningful than raw token quantities for assessing relative influence
  • High percentage concentration may indicate centralization risks
  • Date selection impacts the cost basis calculation at that point in time

Parameters

  • Date: User-defined parameter specifying the historical point for cost basis calculation
  • Number of Tiers: Determines exactly how many divisions the cost basis spectrum will be split into (e.g., 33 creates 33 distinct cost-based tiers)