Cryptocurrency Struggling to Regain its Footing

It’s been a slow week in cryptocurrency. For once, Elon Musk decided to tweet about something else this week. Prices haven’t yet bounced back from their plunge a few weeks ago.  Bitcoin and Ethereum oscillated throughout the week though neither has come close to its all-time high. Nevertheless, the spotlight continues to shine on crypto. 

The media’s sentiment for example has risen back to pre-SNL levels, suggesting that the events of the past few weeks were a minor interruption in crypto’s rise. The chart below compares mentions of cryptocurrency terms as an investment with mentions of them as a scam/pump and dump/etc. on television news.  

Sentiment aside, the raw coverage seems to have declined. The past week has seen a sharp drop in stories covering the topic. Could this be due to it being boring, or has cryptocurrency actually lost mainstream momentum? It’s likely the former, but it will become clearer in the coming weeks. 

Unsurprisingly, crypto fanboys on Twitter weren’t much deterred. After decreased activity a few weeks in a row, Cryptwit frenzied. The chart below shows the total number of Tweets on a weekly basis from our 60+ crypto-adjacent prolific Twitter users. The second week of May, which contained Musk’s hosting of SNL, saw decreased activity, perhaps suggesting that “cold feet” is the dominant response when things look bad. Since then, activity has started to tick back up.

Finally, let’s observe what factors have most impacted the price of ETH in the past 3 months. By far the most influential has been Net Unrealized Profit Loss (NUPL), which essentially measures how much profit could be made all investors sold today. Useful measures like this are available largely due to the open-source nature of cryptocurrencies and the blockchain. Also important is the value of the dollar, the biggest target of fiat-haters, as well as search data for topics like alternative and stable coins. Additionally, our economic strength indices which measure the relative strength of areas of the economy indicate retail and import/export strength are both important metrics.  


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