This article explores on-chain analysis and its potential to enhance your cryptocurrency trading and investing strategies.
On-chain analysis, also known as blockchain analysis, involves examining various factors within cryptocurrencies to refine your trading and investment choices.
Moreover, on-chain data refers to the comprehensive record of every transaction that has occurred on a blockchain network. For public blockchains like Bitcoin and Ethereum, this transaction information is accessible to anyone.
When effectively leveraged, on-chain metrics can transform blockchain transaction data into valuable insights for the crypto market. This includes the integration of these indicators with technical and fundamental analysis for more informed decision-making, as well as tracking the movements of large holders, often referred to as whales.
Do you sometimes feel like you’re lagging behind in the crypto market?
On-chain analysis may be your solution. While it’s a well-known term, true expertise is rare.
This form of analysis is one of the richest sources of alpha.
Here’s your introductory guide 
— pothu (@cryptoPothu) June 9, 2022
Types of On-chain Data
There are three primary forms of on-chain data:
- Raw On-chain Data: This consists of basic indicators useful for assessing the development level of a network. Examples include transaction counts, transaction volumes, the number of active addresses, and the count of wallets with non-zero balances, along with total wallets holding a specified amount of tokens. This data is easily retrievable through a block explorer and serves as an invaluable starting point.
- Aggregated Data: This type includes collated on-chain metrics that provide deeper insights into the network’s condition. Various platforms offer robust dashboards and visualizations for easier comprehension of the data. Notable examples include Nansen, Dune, and Messari.
- Entity Data: This information links groups of wallets to specific individuals or institutions, allowing users to track whether certain entities are buying, holding, or selling cryptocurrencies. It’s particularly useful for monitoring the actions of significant players in the crypto space.
How to Access On-chain Data
The most effective way to access on-chain cryptocurrency data is through personal research, which may require running your own node.
Alternatively, you can obtain on-chain data from analytical platforms. Numerous data platforms utilize machine learning to provide enhanced insights. Some of these platforms include:
- Glassnode provides basic on-chain metrics at no cost, along with advanced metrics and high-frequency time-series data for a fee.
- CoinMetrics offers free access to data on approximately 37 crypto-assets, including both on-chain metrics and correlations.
- IntoTheBlock is another platform that offers a broad array of analytical tools, covering sentiment analysis, order book data, and on-chain analysis for multiple crypto-assets.
For more updates on cryptocurrency, check out the Altcoin Buzz YouTube channel.
Discover the most undervalued assets, up-to-date research, and NFT insights with Altcoin Buzz Access. Join us today for $99 a month.
The post Discover On-Chain Analysis appeared first on Altcoin Buzz.
