In a report on Jan. 9, on-chain analytics provider Glassnode suggested that the market was in a state of slumber earlier this year. From the beginning of FTX in early November until now, they have actually maintained a narrow range of ups and downs.
The recent ups and downs of BTC and Ethereum are at historical lows, which may be the prelude to something bigger.
[Historically, this phase precedes explosive market moves that have not only halved asset valuations, but also sparked new bull markets."
The #Bitcoin and #Ethereum markets kicked off the new year with a sleepy approach.
Realized volatility of these two major assets is extremely low, historically, before experiencing explosive moves in any direction,
More information on the on-chain version in the first week of 2023.
Digital currency history ups and downs low
BTC has traded only in the $557 price range for more than three weeks. It finally broke above $17,000 on Jan. 9, but still appears to be in a consolidation phase.
In November 2018 and April 2019, such a low realized volatility was achieved twice recently. The first stage is a sharp decline in the market, and the second stage is a sharp rise in the market.
Also, except for November 2018, all previous instances were like this. "Most trades are up ahead of a more volatile environment ahead."
On-chain activity, such as new and actively active BTC addresses, has been flat for several months. According to Glassnode, the total amount of dollars processed online in BTC has been plummeting.
Big deals have fallen, "suggesting a significant stagnation in capital flows of an institutional size and potentially a serious shake in confidence among this group."
Ethereum gas prices have been trading near cycle lows, indicating a marked drop in demand for block space. This has cut across many sectors, the report added.
[The dominance of gas consumers is decreasing compared to several industries: MEV robots, bridges, DeFi protocols, and ERC-20 tokens."
Furthermore, 2022 is the first year in which BTC and ETH close below the previous cycle highs.
Glassnode's view is that the 2022-23 holiday season has been historically quiet, "rarely for very long."
Cryptocurrency Market Outlook
This Monday's explosive start has run out of steam. Therefore, the market has not changed much in the past 24 hours, and the total market value still reaches 885 billion US dollars.
In addition, according to the reduction data of the peak capitalization level of CoinGecko, it remains at 71.3%.
If history repeats itself, a rebound is possible in the next month or two, but short positions may continue into the second half of 2023.
