The crypto market has been in a sharp downturn for the past 10 days or so and has failed to produce a Santa Claus rally.
With just days left until the end of 2024, on-chain data actually shows that all of this could change in quite an unexpected way.
Trading volume showing bullish signal?
Late 2024 saw a spectacular rise in BTC prices, soaring from under $70,000 to over $108,000 in less than two months after the US presidential election. However, on a smaller time frame, the asset has struggled over the past 10 days, falling from the above ATH to $92,000 and currently hovering around $94,000.
Furthermore, trading volumes have been down over the past week, which is believed to be due to the extended holiday period. However, according to data from Santiment, that could actually be a driving force behind the price increase.
The analytics platform points out that, during times of low trading volume, whales play a particularly important role if they continue to accumulate.
Many large investors have been “buying” various assets recently, not just BTC. In fact, “speculative altcoins” are even more likely to rally on such occasions, and this could benefit memecoins like DOGE.
On-chain data shared by Ali Martinez indicates that Dogecoin whales have taken advantage of the price drop to buy more tokens in large amounts over the past few days.
Source: Ali Martinez
Stablecoins on Binance
Another factor is the growing amount of stablecoin reserves on the world's largest crypto exchange. Binance has seen a sharp increase in its reserves, which are often deployed to accumulate BTC or altcoins.
According to CryptoQuant, the exchange currently holds $29 billion worth of USDT and USDC, which “highlights Binance’s important role in providing liquidity and stability to the market during this explosive growth period.”
“Stablecoins like USDT and USDC are important for traders and institutional investors, acting as a bridge between fiat and crypto, and allowing seamless trading during volatile periods.”
The report concludes that this surge in the two largest stablecoins by market capitalization is a “bullish signal.”
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