On-chain data collected from Glassnode / Coinglass / Defi / Theblock
Bitcoin market experienced unusually low realized volatility during the holiday season, dropping to 24.6%
Historically, low volatility in the bitcoin market has often been followed by increased volatility
Low volatility has occurred at key turning points in the market such as the start of the bull market in 2012-2013, before the -50% drop in late 2015 and at various points during the bull run from November 2016 to November 2018, April 2019 before the rise from $4.2k to $14k in July 2019 and July 2020 before the 2020-21 bull run to $64k.
When it comes to ETH, which has seen its monthly realized volatility drop to 39.8%, there are even fewer historically quiet times. The two most notable occurrences are in November 2018 (a sell-off of -58%), which preceded high volatility, and in July 2020 (a bull market for 2020–21).
The 2019–20 timeframe is an important historical illustration of how the momentum of on-chain activity measurements may be used to track recovery in network fundamentals.
The overall amount of USD processed by the Bitcoin network has been falling dramatically despite this temporary surge in address activity. Compared to Q3-2022, when daily transfer volume peaked at almost $40 billion, it is now only $5.8 billion per day.
Daily settlement volumes are back to their pre-bull 2020 levels, which essentially denotes the removal of institutional-sized money from the network.
The decline in transfer volume is highlighted by the reduced dominance of transactions worth $10 million or more. These large transfers made up 42.8% of the market before the FTX collapse, but now make up only 19.0%. This suggests that there is a significant decrease in institutional-sized capital flows, indicating a loss of confidence among this group. It also suggest that there could be significant drop in any doubtful capital flows that may be associated with the FTX/Alameda entities.
There is still weak demand for Bitcoin block space, resulting in little upward pressure on Bitcoin fee market. The measure of Miner revenues 4-year Z-Score has not yet made any significant progress towards the positive territory and is currently -0.67 standard deviations below the average.
Bitcoin's low on-chain utilization is matched by Ethereum, as the average gas price paid on the Ethereum blockchain is still near its lows. Since September, the average gas price has remained between 16 and 23 Gwei, similar levels seen during the June-July 2021 consolidation and immediately following the COVID market panic in May 2020
When analyzing gas consumption by sector, a decline in dominance is apparent in several areas: MEV bots, Bridges, DeFi protocols, and ERC-20 tokens. These four sectors represented 45.5% of total gas consumption between September 2020 and September 2021, with DeFi protocols being the primary contributor. Currently, their dominance has dropped and they now account for 22.6% of network gas consumption
The Realized Cap is an important metric in on-chain analysis that helps track how much capital is flowing into and out of digital assets. It avoids valuing coins that are no longer in circulation at the current market price and is a good way to compare the true value of different assets. Recently, the Bitcoin Realized Cap has dropped by 18.8% since its all-time high, representing a loss of $88.4 billion in capital from the network. This is the second-largest decline in history and the largest loss in terms of USD. It's important to understand the Realized Cap is the metric that measures inflows, outflows, and true invested value.
The Ethereum Realized Cap is a metric that helps track how much capital is flowing into and out of the Ethereum digital asset. Recently, it has dropped by 29.2% since its all-time high set in January 2022, representing a loss of $67.1 billion in capital from the network. This is the worst bear market in history in terms of USD losses, but not as severe as the 2018-2019 bear market which had a 35.8% drop. This means that Ethereum investors have lost a lot of money and this downturn is worse than it has been before.
There is a way to measure how much of the digital assets market is controlled by a specific asset, like Bitcoin. But the commonly used metric, called "Bitcoin dominance," can be easily manipulated by entities with large and often illiquid stakes.
A new measurement called "Realized Cap Dominance" aims to track the real investments made into digital assets like BTC and ETH, rather than their perceived value. It can also be used to track investments made in other digital assets, and it helps to show the real capital flows and structural changes in the market. This new measurement is a better way to understand the market and how it's really behaving.
Institutional investors, like BlackRock and BNY Mellon, prefer Circle's USDC because it is transparent. Every month, an independent firm confirms the size of the USDC reserve. Tether's USDT has had trouble providing reserve data and was fined for making false statements about its reserve data. This shows how important transparency is for stablecoins and how USDC is better than its competitors.
StablesCoins by Chains
@coinmetric
DEFI Total Locked
DEX
Google Search Volume on Bitcoin and Ethereum on a downtrend
If you're interested in staying up-to-date with economical & crypto news, I would really appreciate it if you could consider subscribing.
Weekly Crypto On-Chain Update - January 11, 2023
Weekly Crypto On-Chain Update - January 11, 2023
Weekly Crypto On-Chain Update - January 11, 2023
Weekly Crypto On-Chain Update - January 11, 2023
On-chain data collected from Glassnode / Coinglass / Defi / Theblock
Bitcoin market experienced unusually low realized volatility during the holiday season, dropping to 24.6%
Historically, low volatility in the bitcoin market has often been followed by increased volatility
Low volatility has occurred at key turning points in the market such as the start of the bull market in 2012-2013, before the -50% drop in late 2015 and at various points during the bull run from November 2016 to November 2018, April 2019 before the rise from $4.2k to $14k in July 2019 and July 2020 before the 2020-21 bull run to $64k.
When it comes to ETH, which has seen its monthly realized volatility drop to 39.8%, there are even fewer historically quiet times. The two most notable occurrences are in November 2018 (a sell-off of -58%), which preceded high volatility, and in July 2020 (a bull market for 2020–21).
The 2019–20 timeframe is an important historical illustration of how the momentum of on-chain activity measurements may be used to track recovery in network fundamentals.
The overall amount of USD processed by the Bitcoin network has been falling dramatically despite this temporary surge in address activity. Compared to Q3-2022, when daily transfer volume peaked at almost $40 billion, it is now only $5.8 billion per day.
Daily settlement volumes are back to their pre-bull 2020 levels, which essentially denotes the removal of institutional-sized money from the network.
The decline in transfer volume is highlighted by the reduced dominance of transactions worth $10 million or more. These large transfers made up 42.8% of the market before the FTX collapse, but now make up only 19.0%. This suggests that there is a significant decrease in institutional-sized capital flows, indicating a loss of confidence among this group. It also suggest that there could be significant drop in any doubtful capital flows that may be associated with the FTX/Alameda entities.
There is still weak demand for Bitcoin block space, resulting in little upward pressure on Bitcoin fee market. The measure of Miner revenues 4-year Z-Score has not yet made any significant progress towards the positive territory and is currently -0.67 standard deviations below the average.
Bitcoin's low on-chain utilization is matched by Ethereum, as the average gas price paid on the Ethereum blockchain is still near its lows. Since September, the average gas price has remained between 16 and 23 Gwei, similar levels seen during the June-July 2021 consolidation and immediately following the COVID market panic in May 2020
When analyzing gas consumption by sector, a decline in dominance is apparent in several areas: MEV bots, Bridges, DeFi protocols, and ERC-20 tokens. These four sectors represented 45.5% of total gas consumption between September 2020 and September 2021, with DeFi protocols being the primary contributor. Currently, their dominance has dropped and they now account for 22.6% of network gas consumption
The Realized Cap is an important metric in on-chain analysis that helps track how much capital is flowing into and out of digital assets. It avoids valuing coins that are no longer in circulation at the current market price and is a good way to compare the true value of different assets. Recently, the Bitcoin Realized Cap has dropped by 18.8% since its all-time high, representing a loss of $88.4 billion in capital from the network. This is the second-largest decline in history and the largest loss in terms of USD. It's important to understand the Realized Cap is the metric that measures inflows, outflows, and true invested value.
The Ethereum Realized Cap is a metric that helps track how much capital is flowing into and out of the Ethereum digital asset. Recently, it has dropped by 29.2% since its all-time high set in January 2022, representing a loss of $67.1 billion in capital from the network. This is the worst bear market in history in terms of USD losses, but not as severe as the 2018-2019 bear market which had a 35.8% drop. This means that Ethereum investors have lost a lot of money and this downturn is worse than it has been before.
There is a way to measure how much of the digital assets market is controlled by a specific asset, like Bitcoin. But the commonly used metric, called "Bitcoin dominance," can be easily manipulated by entities with large and often illiquid stakes.
A new measurement called "Realized Cap Dominance" aims to track the real investments made into digital assets like BTC and ETH, rather than their perceived value. It can also be used to track investments made in other digital assets, and it helps to show the real capital flows and structural changes in the market. This new measurement is a better way to understand the market and how it's really behaving.
@glassnode
USDT VS USDC TRANSFER VOLUMES
Institutional investors, like BlackRock and BNY Mellon, prefer Circle's USDC because it is transparent. Every month, an independent firm confirms the size of the USDC reserve. Tether's USDT has had trouble providing reserve data and was fined for making false statements about its reserve data. This shows how important transparency is for stablecoins and how USDC is better than its competitors.
StablesCoins by Chains
@coinmetric
DEFI Total Locked
DEX
Google Search Volume on Bitcoin and Ethereum on a downtrend
If you're interested in staying up-to-date with economical & crypto news, I would really appreciate it if you could consider subscribing.
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