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As 2023 draws to a close, the cryptocurrency market is witnessing a volatile trading scenario, keeping traders on high alert. Meanwhile, recent insights from blockchain analytics platform Santiment shed light on the volatile dynamics of the market, particularly focusing on Bitcoin’s trajectory and the factors influencing the broader crypto landscape.
From shifting trading volumes to subtle cues in on-chain activity, let’s explore the reasons behind the recent volatile trading and speculations on what lies ahead for the flagship cryptocurrency.
Why Is The Crypto Market Witnessing Volatile Trading?
The crypto market, after witnessing bullish enthusiasm over the past few weeks, is now navigating a complex landscape marked by fluctuations in top-cap assets. Meanwhile, according to Santiment’s recent analysis, the period from mid-October to early December was a golden phase for crypto enthusiasts, witnessing significant gains.
However, a crossroads has been reached, prompting a closer look at key metrics to decipher the market’s next move. Notably, Santiment’s report highlights a slowdown in trading volumes among top-cap digital assets, signaling a shift in sentiment.
On the other hand, many altcoins are experiencing declines amid Bitcoin’s volume remaining surprisingly high, the report added. The ebb and flow of social conversations further indicate a shift from Bitcoin to altcoins, a pattern considered normal but crucial in understanding market dynamics.
Meanwhile, according to the recent analysis, the recent dip is attributed to the FUD among the crypto market enthusiasts. In addition, the recent rally in the market, reflecting a FOMO scenario that has sent the cryptos to yearly highs, could also be the reason for the recent volatile trading.
Also Read: Binance Further Expands Offering For BONK And 1000SATS Among Others
What’s Next For Bitcoin?
As the crypto landscape undergoes a cooling-off period, Santiment emphasizes the importance of monitoring on-chain signals. The movement of assets like BTC, LINK, and MATIC to exchanges raises concerns, hinting at potential sell-offs.
However, the report also suggested that the mean dollar invested age for Bitcoin is on a positive trajectory, indicating increased activity from previously dormant wallets. This could be a precursor to a quick run at $50,000 in early 2024 if market conditions align. Notably, the Bitcoin price traded at $42,840.10 during writing, a slight dip over the last 24 hours.
Notably, Kaiko, a crypto research platform, highlights Bitcoin’s resilience, indicating a promising year-end performance with only about a 4% dip from its YTD high, showcasing a trend surpassed only by 2020 and 2016.
Also Read: Bitcoin Price Stays Near $43K Despite Whales Dumping BTC To Coinbase & Binance
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