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Following the bloodbath of the previous weekend, the price recovery of top altcoins has been slower than anticipated. The drop was caused by a number of reasons, one of which was uncertainty. The social volume dropped as a result of a sharp decline in volatility of top altcoins. The latest altcoin bloodbath has resulted in a decrease in demand across exchanges, and the volatility of the crypto market is reportedly swinging between 40-60%, according to the chart below.
This has resulted in scaling and demand limitations across spot and derivatives exchanges. In the case of altcoins after a price rally, volatility is a double-edged sword. Volatility is aiding recovery in the same way as it aided profitability during the rally of altcoins such as ETH, LINK, BNB, and XRP. According to data from lunarcrush.com, the social amount of XRP, LTC, and LINK has improved.
This growth in social volume is being motivated by an increase in the number of tweets on crypto Twitter, mentions by influencers, and increased Google search volume. Volatility and social volume are growing rapidly for altcoins in the top 30. In the case of ADA, XRP, BNB, LINK volatility is influenced by demand across exchanges and market capitalization.
Concentration by big HODLers has steadily risen for altcoins such as Chainlink. LINK is concentrated in the pockets of 78 percent of big HODLers, 56 percent of whom are profitable. According to data from intotheblock, the on-chain mood is bearish. The Connection network has received $6.24 billion in funding over the last seven days. Large transactions have fallen by 3%, but this hasn’t yet had a negative effect on prices. LINK is currently trading at $24.76 despite the selling pressure.
Similarly, the price of ETH has risen by 8% in the last 24 hours. Price increases are being driven by an increase in social volume and uncertainty. The story of ETH shortages continues as the percent balance across exchanges falls and 88 percent of HODLers benefit at the current price pace of the 58 percent who owned the altcoin for more than a year.
During the 2018 bull market, Bitcoin volatility was critical to the price rally in both Bitcoin and top altcoins, as altcoins had a high connection with Bitcoin. Likewise, the association between top altcoins and Bitcoin is greater than 0.80, implying that altcoins are following Bitcoin’s lead as it recovers and rallies to the $40000 stage.