USD Balance Distribution by Average Cost

Overview

USD Balance Distribution by Average Cost categorizes wallets based on their average acquisition cost and displays the total USD value (not token amount) held within each cost tier. This visualization reveals how invested capital in USD is distributed across different entry price levels, showing where the majority of USD value is concentrated.

Definition

This indicator divides wallet addresses into a specified number of tiers based on their average acquisition cost, then sums the total USD balance (token amount × current price) held within each tier as of a user-specified date. The results are displayed as a bar chart showing how USD value is distributed across the cost basis spectrum.

Significance

USD Value Concentration: Reveals which cost basis levels represent the most USD investment
Dollar-Weighted Distribution: Shows how actual capital in USD is spread across entry prices
Financial Exposure Mapping: Identifies where the most significant financial exposure exists
Capital Allocation Insights: Provides visibility into how monetary value is positioned by cost basis

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 and sums the USD value (not token quantity) held by addresses in each cost tier 4. Displays results as a horizontal bar chart with acquisition cost tiers on the y-axis and USD value on the x-axis

Interpretation

Tall Bars: Indicate significant USD value concentrated at specific cost levels
USD Clustering: High USD value in certain ranges shows where most capital entered
Monetary Distribution Pattern: Shows whether invested dollars are spread evenly or concentrated
Dollar-Weighted Support: Tiers with high USD value often become stronger support levels

Analysis Applications

Capital-Weighted Position Analysis: Identify cost levels where significant USD investment exists
Dollar Cost Average Assessment: Visualize how invested capital is spread across different price points
Money Flow Distribution: Map where the most money has entered the token
USD Risk Exposure: Evaluate financial exposure across different entry price points

Considerations

Differs from token-quantity distribution by focusing on actual USD value
Exchange rates and token price fluctuations affect the USD calculation
Large USD values may represent fewer large investors rather than many small ones
Date selection impacts both the cost basis calculation and the USD valuation 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)