On-Chain Metrics Suggest This Crypto Bear Market Won’t Be As Brutal As Past Cycles: Analytics Firm IntoTheBlock

Some on-chain indicators suggest that the current crypto market downtrend may not be as steep as past bear markets, according to Lucas Outumuro, head of research at analytics firm IntoTheBlock.

In a new analysis, Outumuro acknowledges that it is becoming “increasingly difficult to say that we are not in a bear market”.

Although the total crypto market capitalization is down 57% from its all-time high of around $3.07 trillion, which it reached last November, Outumuro notes that fundamental indicators have declined less compared to previous bear markets.

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“As much of the demand comes from speculation, it is normal for transaction fees to drop sharply as trading sentiment wanes in bear markets. Staying at higher levels, however, suggests stiffer demand.

Bitcoin has averaged above $500,000 in daily transactions [fees] in May 2022, from $130,000 in May 2018. Ethereum and other crypto assets reflect this same pattern of less steep declines in on-chain activity than in previous bear markets.

According to the researcher, Bitcoin (BTC) and Ethereum (ETH) are also showing steady progress in development activity despite the recent price drop.

“Commitments to the Bitcoin network have increased by more than 50% over the past two years, with developer efforts constantly improving. This has been one of the few leading indicators of the growth of crypto, as being an open source ecosystem, it relies on developers contributing globally to the sustainable improvement of these networks.

Source: IntoTheBlock

At the time of writing, Bitcoin is changing hands for $29,625, down more than 3% on the day.

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On-Chain Metrics Suggest This Crypto Bear Market Won’t Be As Brutal As Past Cycles: Analytics Firm IntoTheBlock


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