GLOSSARY · DIVERGENCE
BSPG
Bitcoin Sentiment-Price Gap
DEFINITION
A composite index measuring the divergence between Bitcoin market sentiment and current price across three quantitative signals. A high BSPG score indicates that sentiment (analyst targets, prediction market odds, on-chain metrics) is significantly disconnected from the current spot price — a potential signal of mean reversion.
Components & Weights
Prediction Market Divergence
Divergence between Kalshi and Polymarket odds on BTC price thresholds. Kalshi is a CFTC-regulated Designated Contract Market (DCM). Polymarket is a decentralized platform; regulatory status for US participants varies.
Analyst Target Dispersion
Standard deviation of Wall Street and crypto-native year-end BTC price targets. Wide range = high institutional disagreement.
On-Chain Overextension
MVRV Z-Score and NUPL deviation from historical norms. Extreme readings signal overvaluation (cycle top risk) or undervaluation (accumulation zone).
Key On-Chain Metrics
| Metric | Formula / Source | Interpretation |
|---|---|---|
| MVRV Z-Score | (Market Cap − Realized Cap) / Std Dev | >7 = cycle top; <0 = cycle bottom |
| NUPL | (Market Cap − Realized Cap) / Market Cap | 0.75+ = euphoria; <0 = capitulation |
Score Interpretation
| Score Range | Signal | Interpretation |
|---|---|---|
| 0–30 | Aligned | Sentiment and price broadly consistent |
| 30–60 | Moderate Gap | Divergence building; watch for catalyst |
| 60–100 | Large Gap | Significant sentiment-price disconnect; elevated volatility risk |