Velocity of Money
economics · metrics
The rate at which a monetary unit changes hands, often used to compare holding behavior with transactional use.
Velocity of money measures how often units of a currency are spent during a period. In crypto analysis, it can be estimated from on-chain activity, though interpretation is difficult because wallets, exchanges, and self-transfers can distort the signal.
High velocity can suggest transactional use, speculation, or exchange churn; low velocity can suggest saving, lost coins, staking, or long-term holding. It should be compared with other metrics, not read alone.
Related terms
Volume
→The amount of an asset traded over a period, measured in units of the asset, quote currency, or notional value.
trading · metrics
Liquidity
→How easily an asset can be bought or sold in size without causing a large price move.
finance · trading
Market Capitalization
→A sizing estimate calculated by multiplying an asset's reference price by its reported circulating supply.
finance · market