Among Altcoins, Watch XRP, Cardano: Sentiment

Sentiment data suggests that XRP and Cardano, among other altcoins, may be worth keeping an eye on in the coming days.

The social dominance of Altcoins like XRP and Cardano has been low lately

According to data from analytics firm EmotionBitcoin is getting most of the attention in the market right now, while some alternatives are not being talked about as much. The indicator of interest here is “social dominance”, to understand which one must first look at “social quantity”.

Social Volume is a metric that measures the total volume of unique social media posts/threads that are mentioning a given asset or term. By “unique” here we mean that the indicator only counts these posts once, regardless of how many times they mention the word (obviously, as long as they have at least one mention).

If the metric instead counted the pure number of mentions, then a thread with a large number of mentions could automatically increase the count, even if mentions are low across social media. Thus, to get a more accurate representation of trends in the broader market, Social Volume only considers unique posts.

Now, social dominance is an indicator that compares the social volume of a given cryptocurrency to the combined social volume of the top 100 assets (by market cap) in the sector.

Here is a chart showing the social dominance trend of the five largest coins in the market: Bitcoin (BTC), Ethereum (ETH), BNB (BNB), XRP (XRP), and Cardano (ADA):

Looks like the value of the metric has stayed low for the altcoins | Source: Santiment on Twitter

As shown in the above graph, bitcoin’s social dominance has been high since it started rallying around the beginning of the year. The asset has been leading the way in price growth over the past few months, so it is not particularly surprising that interest in the cryptocurrency has increased during this period.

The buzz about BTC on social media subsided a bit last month when FUD was circulating the market, but with the latest leg in the rally above the $30,000 level, interest in the coin has increased once again.

While this has happened, other top assets like XRP have only seen a sideways trend or decline in their respective social dominance. This would mean that these cryptocurrencies have failed to garner any significant attention during the past few weeks.

However, the amount of buzz on bitcoin is not always a good sign, as historically too much enthusiasm has often led to the formation of local tops.

On the contrary, since alts are currently not getting much attention, they may have the potential to see further price appreciation. Cardano, BNB and XRP, in particular, have very undervalued indicators right now, which makes them worth keeping an eye on, according to Sentiment.

xrp price

At the time of writing, XRP is trading around $0.48, up 1% over the past week.

XRP seems to have been struggling recently | Source: XRPUSD on TradingView

Featured image from Kanchanara on Unsplash.com Charts from Tradingview.com Sentiment.net