Some indicators on the chain are suggesting that the current crypto market downtrend may not be as sharp as previous bear markets, according to Lucas Otomoru, head of research at analytics firm IntoTheBlock.
In a new analysis, Outumuro acknowledges that it’s becoming “increasingly difficult to say we’re not in a bear market.”
Although the total cryptocurrency market capitalization is down 57% from its all-time high of about $3.07 trillion, which it reached last November, Outumuro notes that fundamental indicators have fallen less compared to previous bear markets.
“Since most of the demand comes from speculation, it is normal for transaction fees to drop sharply as trading sentiment wanes in bear markets. However, staying at higher levels suggests that demand is picking up.
Bitcoin averages over $500,000 in daily transactions [fees] In May 2022, from $130,000 in May 2018. Ethereum and other crypto assets reflect the same pattern of less severe declines in on-chain activity compared to previous bear markets.
According to the researcher, Bitcoin (BTC) and Ethereum (ETH) are also showing steady progress in development activity despite the recent price drops.
“Commitments to the Bitcoin network have increased by more than 50% over the past two years, with developers continually improving. This has been one of the few leading indicators of crypto growth, as it is an open source ecosystem that relies on developers contributing globally to the sustainable improvement of these networks.”
At the time of writing, Bitcoin is changing hands at $29,625, down more than 3% on the day.
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