On-chain analytics firm Santiment recently turned the market spotlight on a few altcoins that are showing promising signs of growth. These cryptocurrencies, notably, show a significant increase in the number of active addresses, a phenomenon historically associated with market capitalization growth.
The daily active addresses metric, a crucial indicator in this analysis, tracks the total number of unique addresses of a cryptocurrency that participate in transactions on the blockchain. This metric, often compared to unique user traffic on a website, provides valuable insights into interest and current activity on the network.
When this metric presents high values, this generally indicates an active and robust participation of users on the network, suggesting a high interest in the asset. Conversely, lower numbers could indicate decreasing interest among traders, reflecting lower daily trading activity.
📊 #Litecoin, #Makerand #LidoDao are all seeing rapidly rising address activity. Typically, this gradually rising utility is accompanied by market cap growth. While $MKR and $LDO have seen this come to fruition, $LTC has yet to see a similar rise. https://t.co/hOwwknnP98 pic.twitter.com/rbmswUrx82
— Santiment (@santimentfeed) January 4, 2024
Santiment Suggests a Possible Recovery for ADA Based on Whale Activity
Santiment shared a revealing chart highlighting the increase in daily active addresses for three specific altcoins: Litecoin (LTC), Lido DAO (LDO), and Maker (MKR). The graph shows a sharp increase in the activity of these networks, signaling active investor involvement.
Historically, a simultaneous increase in user activity has been a harbinger of volatile price movements. “Generally, this increase in utility is followed by a growth in market capitalization”, points out Santiment. This pattern appears to be repeating itself as Maker and Lido DAO have recorded upward momentum recently.
Interestingly, Litecoin did not show a sudden change in price despite the increase in daily active addresses. This could indicate the formation of a bullish divergence in LTC price, suggesting a possible correction soon to align with the trends seen in LDO and MKR.
Another notable case is that of Cardano (ADA). ADA whales have demonstrated active buying behavior recently, as pointed out by analysts using data from Santiment. This buying trend continues even after a significant drop in the cryptocurrency’s price, signaling a possible recovery.
Therefore, Litecoin’s stability is also worth highlighting. After a recent drop, the LTC price has remained around $65, indicating remarkable resilience in the market.
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