On-Chain Data Signal

Definition ∞ An on-chain data signal is a piece of information derived directly from a blockchain’s public ledger, providing insights into network activity and participant behavior. Examples include transaction volumes, active addresses, and token movements between different entities. These signals offer transparent, verifiable market intelligence.
Context ∞ On-chain data signals are increasingly utilized by sophisticated digital asset analysts to understand market dynamics beyond simple price charts. These signals can indicate accumulation, distribution, or network health, offering a distinct advantage over traditional market metrics. The interpretation of these signals requires a deep understanding of blockchain mechanics and economic principles.