Dunamu, the operator of digital asset exchange Upbit, said on Thursday it launched 2 new on-chain data-based indexes.

On-chain data refers to transaction records and asset transfer histories that occur on a blockchain. Demand has existed because it allows detailed tracking of asset flows, but the complexity of tracking and processing the data has made it difficult for retail investors to use directly.

The indexes released this time by Upbit Data Lab are the "Ethereum Small-cap Undervalued Index" and the "Ethereum Small-cap Overvalued Index".

The 2 indexes use the MVRV (Market Value to Realized Value) indicator. MVRV shows whether a digital asset’s current price is higher or lower than investors’ average on-chain purchase price. It makes it relatively straightforward to compare whether a specific asset is in an oversold or overbought state.

The Ethereum Small-cap Undervalued Index is calculated for Ethereum ERC-20 small and mid-sized assets supported for trading in Upbit’s won market.

It reflects price movements of 5 representative assets whose market trading prices are lower than the on-chain wallet average purchase price, and can be used to check price changes of a group of assets deemed undervalued on an on-chain basis.

The Ethereum Small-cap Overvalued Index includes, on an equal-weighted basis, 5 representative tokens whose current prices are higher than the average purchase price of on-chain participants. This allows users to track price changes of a group of assets that may have short-term overheating potential.

The 2 indexes are rebalanced on the 2nd day of each month. Constituents added and removed are also disclosed on the same day. Stablecoins, memecoins and assets with investor protection-related issues are excluded from evaluation.

Kim Dae-hyun (김대현), Dunamu’s chief data officer, said, "Blockchain on-chain data is 공개돼 for anyone to see, but it is difficult to use, and information asymmetry has been large in this area." He added, "Starting with the launch of these 2 on-chain strategy indexes, we plan to actively develop related indexes so that retail investors can also use on-chain data."