Question 1

What does velocity measure?

Accepted Answer

It measures how actively the coin supply is used. We take the value transferred on-chain each day, annualize it (×365), and divide by the circulating supply. A velocity of 2 means an amount equal to twice the entire supply changed hands over a year; a velocity near zero means coins are mostly held, not spent.

Question 2

Is high or low velocity better?

Accepted Answer

Neither is inherently good — it describes behaviour. High velocity points to coins being used as a medium of exchange (lots of transacting); low velocity points to store-of-value behaviour (holders sitting tight). Economists also link a sustained fall in velocity to accumulation. Read it alongside coin-days destroyed and active addresses.

Question 3

What counts as transfer volume?

Accepted Answer

Only native coin moved between parties: standard transfers (and multi-recipient sends, each recipient counted once). Block rewards / coinbase are excluded — they are new issuance, not a transfer — and token transfers are excluded because their amounts are token units, not coins. The volume is normalized to a common unit across both chains.

Question 4

Why does it need no price?

Accepted Answer

Both the numerator (transfer volume) and denominator (supply) are measured in coins, so velocity is a pure ratio. That is why it reconstructs cleanly over the full Proof-of-Work history, all the way back to the 2018 genesis — unlike valuation metrics that need a market price for every day.

QRL Velocity

Velocity

FAQ about this chart

QRL Velocity

Velocity

FAQ about this chart