Cryptocurrency analytics firm Santiment, in its weekly market review, said that following sharp declines in Bitcoin and altcoins, some on-chain indicators are beginning to point to a possible recovery. While noting rising investor losses and negative market sentiment, the company added that it is still too early to speak of a definitive bottom.
According to data shared by Santiment, Bitcoin has lost roughly 9% of its value over the past week, falling to the $67,000 level. Ethereum, meanwhile, dropped by about 13%, falling below $2,000. Over the same period, XRP lost 13.5%, Uniswap roughly 16%, and Quant more than 16% of its value.
The total value of the cryptocurrency market fell by more than 9% over seven days to $2.94 trillion, while trading volumes rose 30% compared with the previous week. Santiment noted that although trading volume increased, cryptocurrency discussion on social media declined.
Santiment: Fear Grows Among Investors
According to Santiment’s social media analysis, the ratio of positive to negative comments in the cryptocurrency market has fallen significantly over the past two months.
On September 14th, there were 1.6 positive reviews for every negative one, while the latest data shows this ratio has dropped to 0.73. In other words, there are roughly four negative reviews for every three positive ones in the market.
The company noted that historically, extremely negative market sentiment has preceded price recoveries. However, it said the current level of fear has not yet reached extraordinary levels, and negative sentiment may need to persist for some time before a stronger recovery signal emerges.
One of the key indicators highlighted in Santiment’s assessment was the MVRV ratio, which measures the average unrealized profit and loss of investors.
According to the company’s data, Bitcoin’s 30-day MVRV (Most-Time High Rebound) has fallen by about -11%, while its 365-day MVRV has dropped by -12%.
This indicates that investors who were active during the relevant periods incurred losses on average.
Santiment noted that periods in which both short-term and long-term MVRV values turned significantly negative in historical data could create relatively lower-risk conditions for taking new positions.
Another important indicator was the ratio of profitable to losing transactions across the supply.
According to recent data, for every profitable transaction on the Bitcoin network, there are roughly three losing transactions. Santiment noted that periods when investors traded at this level of loss have historically coincided with certain local market lows.
However, the company stressed that these indicators do not necessarily signal a guaranteed short-term rise.
Large Bitcoin Investors Continue to Hold Their Assets
According to Santiment’s analysis, the share of large Bitcoin investors in the total supply has declined slightly in recent weeks.
The large investor group that controlled 68.29% of the Bitcoin supply on November 2nd now holds 68.11%, according to the latest data.
The company said this change did not signal a large-scale sell-off, but that buying by individual investors was more prominent during the current downturn.
According to Santiment, a stronger bottom signal could be triggered by large investors returning to accumulation while individual investors withdraw from the market.
On the other hand, indicators such as the number of active addresses and network growth on the Bitcoin network have remained largely flat despite the sharp price decline. The company viewed the continued stability of network usage positively.
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Another development highlighted by Santiment was the outflow of money from Bitcoin ETFs throughout November.
According to the company’s assessment, during the period examined since the beginning of November, there was only one day with a limited net cash inflow, while net outflows were recorded on the other days.
Santiment noted that past large-scale ETF outflows have coincided with periods of peak investor fear.
However, the company stressed that there has not yet been an exceptionally large outflow that could be considered a strong signal of a bottom.
$68,000 is a Critical Level for Bitcoin
Santiment said Bitcoin is trying to find support around $68,000, and that a move back above the $70,000 level could be important for short-term price action.
The company also noted that roughly half of social media discussion in the cryptocurrency market focuses on Bitcoin. This shift in interest from speculative altcoins toward Bitcoin is described as a pattern seen in past market cycles before a recovery.
According to Santiment, negative MVRV values, a rise in losing trades, and deteriorating market sentiment suggest Bitcoin may be approaching a lower-risk price zone compared with previous periods.
*This is not investment advice.
