Crypto: Algorand collapses after 300% jump in active addresses

While some cryptocurrencies explode their historic ceiling at the first light of a bull run, others seem to be biding their time. Algorand, with its expanding network, saw a meteoric rise before plunging into a sharp correction. But behind this volatility lie intriguing market movements that merit further analysis of this crypto.

The spectacular growth of Algorand: a network in full swing

Since December 1, the Algorand (ALGO) network has seen its number of active addresses jump by 300%growing from 123,000 to over 427,000. This exponential rise, fueled by increased adoption and growing use of blockchain, has propelled ALGO price at a high of $0.6133.

However, this dynamic came up against a strong correction. In the span of 48 hours, ALGO price fell by 10.5%, bottoming out at $0.459. According to IntoTheBlock, this intense network activity should have stabilized the increase.

But the drop in the number of active addresses, which now stands at 343,000, has weakened this dynamic.

Some key figures :

• A 318% increase in the monthly price;
• Large transaction activity halved, from 309 to 162;
• A net flow of large holders fell to -25.34 million ALGO cryptos.

These data clearly illustrate that, without the confidence of major crypto investorsthe market is struggling to maintain a sustainable rise.

Crypto market: whales fail ALGO

Recent Algorand Volatility Highlights the importance of big players of the crypto market, often called “whales”. In recent days, they have significantly reduced their activity, preferring sell rather than buy. Result: a notable drop in the net flow of tokens and a market dominated by short positions.

According to Coinglass, the long/short ratio reveals that the majority of investors are now betting on a continued drop in price. At the same time, the negative funding rate on the DyDx crypto exchange confirms that short positions dominate.

This withdrawal of whales reflects their caution in the face of a still uncertain trend. “ When whales leave the waters, it is often wise for small fish to wait for their return “, some will probably say.

Still, if current support at $0.45 holds, a recovery could propel ALGO towards resistance at $0.71.

In the midst of tumult, bitcoin recently soared beyond $100,000, capturing 57% of the crypto market and more or less relegating altcoins to second place. A blessing for maximalists, but a frustrating wait for those hoping for an impending altseason. There still seems a long way to go for a trend reversal.

Micaiah A.

The blockchain and crypto revolution is underway! And the day when the impacts will be felt on the most vulnerable economy in this world, against all hope, I will say that I had something to do with it