📈 XRP And Dogecoin Flip Solana, Avalanche To Be Among Most Liquid Cryptocurrencies

In a groundbreaking revelation, blockchain analytics platform Kaiko challenges the traditional measure of cryptocurrency value by placing XRP and Dogecoin among the top four most liquid cryptocurrencies, following only Bitcoin and Ethereum.

🌊 Rethinking Liquidity Metrics: Beyond Market Cap and Fully Diluted Value

Kaiko argues that liquidity, reflecting how easily an asset can be traded, provides a more accurate representation of a cryptocurrency's actual value compared to market capitalization. Market cap and fully diluted value, while important, offer an incomplete picture of a cryptocurrency's worth. Liquidity, on the other hand, considers various factors such as supporting exchanges and trading costs, measured through spreads.

📊 Measuring Liquidity: Insights from Kaiko's Analysis

To gauge liquidity, Kaiko's analysis considered market depth at two levels: 0.1% and 1%. The 0.1% metric assessed liquidity for traders, while the 1% market depth reading tracked the liquidity of long-term holders. The report indicates a broad decline in liquidity across both categories in Q3 2023.

🚀 XRP, Dogecoin, and LTC Shine, AVAX Faces Liquidity Challenges

Kaiko's findings reveal that XRP, Dogecoin, Cardano, and Solana performed consistently with their market capitalization rankings regarding liquidity. Notably, XRP and Dogecoin emerged among the top four most liquid cryptocurrencies.

📉 Liquidity Losses: AVAX Drops Despite Stellar Performance

While some cryptocurrencies like Litecoin exceeded expectations, others, including Uniswap, Avalanche, Shiba Inu, and Cosmos, experienced drops in liquidity rankings. Avalanche, in particular, faced a significant liquidity loss, dropping 11 spots despite its notable performance in recent months.

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