# Network Value to Transaction (NVT) Ratio

## Overview

This indicator compares the market capitalization of a blockchain's native token to its total transacted value over a certain period of time. The ratio is calculated by dividing the market capitalization of the token (the token's current market price multiplied by its circulating supply) by the total value transacted.

## 💡 How can I use it?

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This ratio can provide insights into the valuation of the blockchain's token relative to its usage. A high ratio may suggest that the token is overvalued relative to the amount of value being transacted on the blockchain, while a low ratio may suggest the opposite.
