Cryptocurrency analysis platform Santiment addressed the declines in Bitcoin (BTC) and altcoins in its market review published today. While the company’s on-chain data shows that large investors continue to accumulate, some key indicators suggest that the conditions for a strong rally have not yet been met.
According to data shared by Santiment, Bitcoin fell to approximately $81,500, losing nearly 2% on a weekly basis. Ethereum (ETH) also experienced a 2.2% decrease during the same period. The total value of the cryptocurrency market decreased by 1.5%, while trading volumes saw a decline of approximately 7%.
Analysts noted that inflation data, particularly from the US, and uncertainties surrounding the Fed’s monetary policy negatively impacted investors’ risk appetite. While Bitcoin experienced a limited recovery after testing below $80,000, market uncertainty persisted.
Santiment also noted that the decline in the cryptocurrency market was not limited to digital assets. According to the platform’s data, since September 22, Bitcoin has lost approximately 6.5% of its value, while gold has fallen by between 4% and 5%. The decline in the S&P 500 index, however, remained at around 0.3%.
Bitcoin Whales Have Accumulated Over 85,000 BTC
One of the most striking pieces of data in Santiment’s analysis was the purchases made by large Bitcoin investors.
According to the platform, investors holding between 10 and 10,000 BTC in their wallets have accumulated a total of 85,916 BTC since September 18th. This accumulation, which occurred over approximately four weeks, shows that large investors continue to increase their Bitcoin positions despite price drops.
However, Santiment noted that the continued buying by small investors does not create an ideal picture for a strong short-term recovery.
According to analysts, a decrease in the number of small wallets holding less than 0.01 BTC may indicate weakening optimism among individual investors regarding the market. Historically, periods when large investors accumulated while small investors withdrew from the market tended to create more favorable conditions for price increases.
Santiment assessed that if large investors continue to hold onto their holdings and small investors slow down their purchases, the likelihood of Bitcoin returning to the $85,000 to $90,000 range could strengthen.
Looking at on-chain data, Bitcoin’s 30-day market capitalization/realized value ratio (MVRV) has fallen to approximately minus 2.3 percent.
This indicator suggests that investors who traded in the last 30 days are, on average, carrying unrealized losses. According to Santiment, while negative MVRV values historically indicate areas where buying opportunities might begin to emerge, current levels do not yet signal a strong opportunity.
On the other hand, the 365-day MVRV indicator being at 0.56 percent reveals that it is quite close to the average cost for long-term investors.
Bitcoin’s Relative Strength Index (RSI) is around 46.5. This value indicates that there are no significant overbought or oversold conditions in the market.
Santiment also noted that funding rates on Binance have remained largely stable. According to analysts, a significant increase in negative funding rates could lead to a concentration of short positions, and short liquidations in a potential upward move could accelerate price action. However, current data does not yet point to such a scenario.
It was also noteworthy that the amount of Bitcoin held on exchanges began to increase again after the sharp drop at the beginning of October. However, Santiment added that this increase was not at a level that would raise concerns about a large-scale sell-off.
Santiment Explains Notable Movements in Altcoins
Santiment, which also analyzed the altcoin market in addition to Bitcoin, noted that on-chain activity has increased significantly in some projects.
In the platform’s activity analysis, Quant (QNT) stood out with activity data showing a 234% increase in the last 30 days and a 219% increase in the last 90 days.
Staked Ethereum, Starknet (STRK), Wrapped Bitcoin (WBTC), Gnosis (GNO), LayerZero (ZRO), Ether.fi (ETHFI), Basic Attention Token (BAT), Bitcoin Cash (BCH), and Curve (CRV) were also among the notable projects.
Santiment also noted that accumulation activity among the top 100 investors in the Virtuals Protocol (VIRTUAL) token has reached one of its highest levels in recent times.
However, analysts emphasized that increased on-chain activity does not necessarily mean price increases. Increased activity can signal a recovery in declining assets, but it can also be a leading indicator of selling pressure in projects where excessive optimism is observed.
Is It Too Early to Panic in the Cryptocurrency Market?
According to Santiment, although pessimistic views are increasingly prevalent in the cryptocurrency market, a significant panic has not yet emerged.
The platform’s social media analysis showed that approximately eight days ago, bearish expectations outpaced bullish expectations, followed immediately by a market recovery. Recently, however, positive and negative comments have reportedly returned to similar levels.
Analysts pointed out that prices often move in the opposite direction when the vast majority of investors have the same expectations.
The continued accumulation of large Bitcoin whales, the MVRV indicator moving into negative territory in the short term, and pessimism in market sentiment are considered positive signals for a possible recovery.
However, the continued buying by small investors, the stability of funding rates, and the persistence of macroeconomic uncertainties indicate that a strong rally is not yet certain.
*This is not investment advice.
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