The reasons for a possible correlation between the fall of bitcoin and the performance of DEX
The existence of a correlation between these two events seems to emerge by proceeding to a comparison between the DEX volume charts and the Bitcoin price chart. This notably reveals a first increase in the volume of exchanges of decentralized exchanges on April 7, while the value of the cryptocurrency fell from April 6 to 8. Bitcoin then began a slight run that eventually led to the peak of $ 64,840 on April 14. It will subsequently experience a fall over ten days, punctuated by a value below $ 50,000. This was then the period chosen by the DEX volumes to soar.
They have indeed known a sharp increase on the evening of April 18 marked by the sharp drop in bitcoin which then went from $ 60,900 to $ 50,500 $, a decrease of 16%. This trend is confirmed by the data published by Dune Analytics on the evolution of the daily trading volume recorded by DEXs. The latter thus reached their peak in the week of April 22. as the total crypto market capitalization recorded a loss of $ 324 million. As the volumes remained high thereafter, this assumes that traders would have turned to altcoins while waiting for bitcoin to complete its correction phase.
The sign of an imminent arrival of the altseason
The majority of altcoins are now pushing to regain selling prices approaching their last highs as bitcoin struggles to make $ 55,000 a support level. The strong activity observed at the DEX level could thus hint at the imminent arrival of an altseason. Such a sequence of events is all the more probable that the altseason has historically emerged when bitcoin entered a downturn after a new all-time high.
Another favorable element, the recent analysis of the dominance of bitcoin on the rest of the market showed that it was at its lowest level for 7 months. Traders could therefore have anticipated the blow by moving towards DEX and DeFi in order to position themselves as early as possible in order to get the maximum profit from this period.
The comments and opinions expressed in this article are those of the author alone, and should not be considered as investment advice. Do your own research before making any investment decisions.