BittsAnalytics provides its users with real-time social media sentiment, calculated with machine learning from social media texts about individual cryptocurrencies. Social media sentiment has proved as a very valuable signal many times in the past and again in recent downturn, effectively signalling intermediate bottom at 3700 USD.
There were several days of severe negative social media sentiment for Bitcoin during recent correction, as evident from this picture, showing daily social media sentiment for Bitcoin:
Similar picture was seen for social media sentiment on hourly level.
After the first surge on October 22nd the price remained first flat and then fell after retreat in sentiment. Yesterday however came a second even stronger sentiment surge when Bitcoin was at around 3700 USD and this sentiment surged to new intermediate heights. Unlike previous surge, the positive sentiment trend persisted this time and Bitcoin price also followed afterwards.
Social media sentiment was thus again proven very valuable as a market sentiment indicator. It is available as part of our Advanced subscription, more information is available at:
Social Media Sentiment also flashed warnings with Bitcoin at 6500 USD, you can read more in our previous blog:
Warning from our market sentiment indicator was again correct – flashing warnings with Bitcoin at 6500 USD
Our platform BittsAnalytics has recently introduced another advanced feature for analysis of cryptocurrencies – Blockchain Analytics. For main cryptocurrencies, such as Bitcoin, Bitcoin Cash, Ethereum and main ERC-20 based tokens we are analyzing the changes in holdings of top token holders. Our research has shown that such changes can have a high impact on prices and this led us to include blockchain analysis to the selection of our cutting edge tools for investors in digital assets.
In this blog post we would like to show you an example of impact of changes in top token holdings on subsequent price developments. As the Bitcoin Cash has dominated the recent news with its hard fork, we decided to focus on this particular cryptocurrency.
Over the summer there were several examples of large reduction among the top 10 non-exchange token holders. Often this means that the holdings are moved to exchanges and will be soon sold, resulting in selling pressure. For example, on 21st June 2018, there was a large reduction in holdings of one of the largest addresses at the time:
In seven days immediately after the aforementioned balance reduction, the Bitcoin Cash price collapsed from 874 USD to 660 USD for a negative return of -25%. In the same period Bitcoin lost less than 2%, leading to +23% of alpha for the trade based on this blockchain analysis.
If you are interested in using blockchain analytics for generating alpha in your digital assets trading please contact us at [email protected]
An example screenshot from the platform showing evolution of top 20 holders for Bitcoin with exchanges separately denoted:
Returns of cryptocurrencies in the last 24 hours can be described with one word – mostly in the green.
Big winner is Bitquence with over 40% return.
Very interesting chart – Ethereum is gaining on Bitcoin in terms of social media mentions:
During August it was still predominantly behind but then it started to gain momentum and on 15. September for the first time (at least for a day) overtook Bitcoin in terms of mentions. Bitcoin then regained a clear advantage for some time while in the last month the social media prominence of both are again more comparable. So enthusiasts of both coins should be happy – Bitcoin is in a great rally in the last few months while Ethereum is also gaining in social media domain and in flurry of development activity.
Returns of the last 24hours are mixed. While Bitcoin is down around 1.5% others like Ethereum, Bitcoin Cash, Ethereum Classic, Dash are up. Ethereum Classic has actually made over 20% over the last 24 hours.