Dogecoin, XRP Flashing ‘Overlooked’ Bullish Signal, Santiment Reveals
12 Dicembre 2024 - 5:30AM
NEWSBTC
The on-chain analytics firm Santiment has revealed that Dogecoin
and XRP are flashing bullish signals in an often overlooked metric.
Dogecoin, XRP, & Bitcoin Recently Saw A Decline In Mean Dollar
Invested Age In a new post on X, Santiment has discussed the latest
trend in the Mean Dollar Invested Age indicator for a few of the
top coins in the cryptocurrency sector. Related Reading: Crypto
Suffers $1.6 Billion Liquidations As XRP, DOGE Down 10% The “Mean
Dollar Invested Age” keeps track of the average age of every dollar
the holders have invested into the cryptocurrency. This metric is
similar to the Mean Coin Age, an indicator that measures the
average age of tokens in the entire circulating supply. The Mean
Coin Age uses on-chain data to determine when every coin was last
moved on the network and calculates the mean for the supply based
on it. The Mean Dollar Invested Age works on the same data, except
that it converts the coins to their USD value based on the price at
their last movement. Now, here is a chart that shows the trend in
the Mean Dollar Invested Age for five top digital assets: Bitcoin
(BTC), XRP (XRP), Dogecoin (DOGE), Ethereum (ETH), and Chainlink
(LINK). As displayed in the above graph, the Mean Dollar Invested
Age has registered a decline for all five of these cryptocurrencies
recently, but the scale of the drawdown has been quite small in the
case of Ethereum and Chainlink. On the other hand, Bitcoin, XRP,
and Dogecoin have witnessed a very significant decrease in the
indicator. As for what it means when this metric trends down,
Santiment explains: When a network’s Mean Dollar Invested Age line
is moving down, it indicates that older, stagnant wallets
(particularly from large key stakeholders) are circulating their
dormant coins back into circulation, increasing network activity.
While this suggests that the older hands are potentially
participating in selling, another way to look at it could be
that new capital is flowing into the market, buying up
these dormant coins and bringing the average age down. Related
Reading: Litecoin Not To Be Overlooked, Analytics Firm Says: Here’s
Why Indeed, it seems historically, the pattern has proven to be
bullish, as the analytics firm has pointed out: This is one of the
key indicators throughout the history of each coin’s lifespan that
helps validate that a bull market can and should continue. The 2017
and 2021 bull markets similarly did not come to a halt until
assets’ mean ages started going “up” (getting older) again. Out of
the three assets that have seen a sharp decline in the Mean Dollar
Invested Age, Dogecoin has particularly stood out for both the
scale and the speed of the drawdown; the average dollar invested
into the memecoin has become 31% younger over the last eight weeks.
DOGE Price At the time of writing, Dogecoin is floating around
$0.403, down almost 2% in the last seven days. Featured image from
Dall-E, Santiment.net, chart from TradingView.com
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