Data shows that XRP and Ethereum are gaining social volume as investors seemingly begin to lose interest in Bitcoin.
Bitcoin social volume shows decline, traders shift focus to XRP and Ethereum
This is evident from data from the on-chain analytics company Sanitation, BTC’s social volume has declined since its March surge. The “social volume” here refers to a statistic that tells us about the level of discussion around a particular cryptocurrency that social media users are currently participating in.
The indicator measures this in terms of the total number of text documents (that is, the posts on various social media platforms such as Reddit, Telegram and Twitter) that mention the item in question.
Something to keep in mind is that social volume does not give weight to the actual amount of discussion that takes place within a post; what this means is that even if a text document mentions the term multiple times, the contribution to the value of the metric still remains only one unit.
The benefit of this limitation is that it gives a better idea of the amount of talk the coin receives from the general user. If the restriction did not exist, a long, isolated post with a large number of references to the cryptocurrency could potentially only skew the indicator.
Here is a chart showing the trend in Bitcoin, Ethereum, Binance Coin, XRP, Cardano, and Dogecoin social volumes over the past year:
How the social volume of the various assets in the sector has changed in recent days | Source: Santiment on Twitter
As shown in the chart above, Bitcoin’s social volume saw a huge surge in March as the asset’s value first took a hard plunge and then recovered with a spectacular rally.
Such sharp price action always draws attention to any cryptocurrency, so it makes sense that social media users started participating in massive amounts of discussion about the coin.
However, since the April high, the asset’s price has been in a general downward trend. Social volume has also been on a downward trajectory, although the indicator has seen a small increase during the recent volatile event.
The high volatility had come about when the US SEC sued Binance and Coinbase back to back, sparking widespread panic in the market. As mentioned earlier, it is not particularly unusual to see social volume increase during such rapid price swings.
Ethereum, XRP, and Binance Coin also saw a spike in discussions about them during this event, surpassing the levels they have seen in recent months.
While volatility is clearly a factor in this increase, it’s also possible that the slowdown in Bitcoin discussions contributed to it as well. It seems that investors have gradually lost interest in BTC and are now shifting their focus to altcoins like XRP.
XRP price
At the time of writing, XRP is trading near $0.5, down 4% over the past week.
Looks like the asset has been moving sideways | Source: XRPUSD on TradingView
Featured image of Kanchanara on Unsplash.com, charts from TradingView.com, Santiment.net