Reserve Risk is an indicator that measures the confidence of long-term holders relative to the current price of Bitcoin. It reflects the balance between price and conviction. A low Reserve Risk value suggests high confidence among long-term holders while the asset is undervalued. Conversely, a high Reserve Risk value suggests low confidence during periods of elevated price, indicating increased speculative risk.Reserve Risk is designed to identify optimal periods for capital deployment based on long-term holder sentiment. Historically, periods of low Reserve Risk have been associated with outsized long-term returns, while periods of high Reserve Risk have preceded market corrections or sustained downtrends.Coverage is currently available for Bitcoin (BTC) only.
