Social sentiment towards the ether reached new lows per year as prices are below that of other cryptocurrencies. However, this could indicate that according to Santiment, it is ready to bounce back.
Santiment’s Social Sentiment Tracker has found that traders’ etheric debates on various social media channels such as X, Reddit and Telegram are more bearish compared to other major cryptocurrencies, the Blockchain Data Platform said in the X Post on March 5th.
“For those who are patiently holding ether, the predicted bearishness across social media is a good sign of a potential shift once the crypto market is stable,” Santimento said.
Etheric sentiment was bullish during the last YE, AR of the broader code bull market, but it shifted bearishly afterwards. Source: Santiment
According to CoinmarketCap, Ether (ETH) prices exceeded 20% last month, with the second largest cryptocurrency trading hand at $2,176. By contrast, Bitcoin (BTC) fell just 10% last month, trading at $88,000 per coin.
Mike Cahill, CEO of Douro Labs, a leading contributor to decentralized data networks, told CointeLegraph that while Ether’s misperformance could lead to a decline in social emotions, “it’s important to separate short-term narratives from the long-term foundations.”
“Historically, extreme bearish feelings have often been in line with the bottom of the market. The price movement tends to lead to social emotions, so it’s not the other way around,” he said.
“If the crypto market is stable, ether is well suited to benefit from new liquidity and continued institutional interest.”
From March to September last year, Santiment said, among the broader code bulls, emotions were bullish primarily towards the ether. Since September, traders have become even more bearish. This is a trend that continues in the New Year.
Dominick John, an analyst at Kronos Research, told Cointelegraph that Ether’s performance could be discouraged by short-term investors, but it has a silver lining: extreme negativity often means the bottom of the cycle, saying it’s “prepared for a considerable rebound.”
“Factors such as lower interest rates and developing clear regulations regarding immersing ETH within ETFs could drive it high,” he said.
“Continued purchases by players at institutions, including Trump’s World Free Finance, indicate a growing long-term reliability.”
The Trump Family-backed World Liberty Financial (WLFI) Defi platform has increased ether holdings by $10 million over seven days.
Santiment’s trackers sift through crypto-specific social media channels such as the top 10 words X, where social media mentions have been the most significantly increased compared to the past two weeks.
Related: Has Ethereum lost its advantage? Expert weight
Analysts speculate that the ether is struggling due to weakening network activity, lowered total locked value (TVL), and investor concerns about its supply emissions rate.
Etheric MVRV Z scores are an important metric for assessing whether native tokens are overrated or underrated, and have dropped to their lowest levels in 17 months.
The Ethers MVRV Z-Score hit a similar low level in October 2023, just before it was rebounded to almost 160%. The dip for scores for December 2022 and March 2020 was also in front of the Bull Run.
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