Bitcoin

Isn’t there so much hype anymore? Bitcoin sentiment is waning despite the upward trend

Since its drop below $ 4,000 in March 2020 Bitcoin (BTC) has seen an upward trend beyond its 2017 peak, hitting nearly $ 42,000 recently.. However, during this period, Bitcoin’s activity on Twitter fell short of expectations compared to its price.

By viewing the information on crypto data devices The TIE states that since 2019, the price of Bitcoin has been positioned above its hype-to-activity ratio, a metric that measures the volume of tweets versus the volume of asset trading.

“The activity hype-to-activity index measures the number of tweets a given coin has per $ 1 million in trading volume on that coin,” the CEO of Tie told Cointelegraph. Joshua Frank, as previously reported. According to a study by The Tie, released In August 2019, 1.02 was the industry average for the hype-to-activity ratio.

Isn’t there so much hype anymore? Bitcoin sentiment is waning despite the upward trend
Isn’t there so much hype anymore? Bitcoin sentiment is waning despite the upward trend

Bitcoin’s hype on Twitter significantly outperformed the price for most of 2018, and eventually passed over with price for a brief period in May 2019. The Twitter hype continued to decline, was below price in the second half of May and certainly stayed below price. Even with Bitcoin’s most recent spike on January 8, 2020, the digital asset only had a hype-to-activity value of 1.24, slightly above the industry average.

Source: The Tie

However, traditional media coverage rose sharply after October 2020. When the price of Bitcoin increases dramatically, the asset will gain more general attention, as seen during its spike in 2017 to nearly $ 20,000.. The price of Bitcoin has risen since October, which logically caught media attention.

Source: The Tie

Several big companies like MicroStrategy and Square announced Bitcoin purchases starting in 2020, which had an impact on the scene.. “Bitcoin’s rally was clearly led by institutional investors,” Frank told Cointelegraph on Monday, adding:

“When Bitcoin topped $ 20,000 in December, the average 30-day tweet volume on Bitcoin was only half of its 2017/2018 highs. The lack of conversation on Twitter suggests that those who originally bought were a small number of large investors rather than large numbers of small investors. “

The Tie’s NVTweet Ratio data uses tweets that correspond to market cap and forms the basis of a big player-led Bitcoin price trend narrative.according to Frank. However, recent data suggests increased retail exposure, some of which surfaced in Twitter conversations about BTC. The record Bitcoin mentions on Twitter came around the same time as the recent Bitcoin price correction. Frank added:

“In general, we’ve found that extremely high sentiment combined with unusually high Twitter activity tends to be a negative signal for Bitcoin price in the short to medium term. Bitcoin’s long-term sentiment (a measure of how positive the conversations have been over the past 50 days versus the previous 200 days) is near all-time highs. “

Bitcoin price has recently dropped about 28% from its high, but has rebounded slightly since the fall at press time.

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