Blockchain analytics analyse transactions, trades, and wallet address holdings to understand real-time blockchain market behaviour. Investors and traders may monitor who owns or trades cryptocurrencies, how smart actors organize their portfolios, and how token holders react to market events. This market data, unavailable in conventional finance, provides investors a new research and due diligence tool.
Important data must be recognized. Although blockchains record every transaction and event, traders only utilize partial data. Elite traders can overlook irrelevant information. Explore the most crucial onchain data points to guide you.
On-chain returns are higher with Smart Money wallets. Smart Money designations go to top liquidity providers, DEX traders, NFT traders, airdrop farmers, and others.
Onchain analysis may concentrate on token activity and holders, not wallet addresses. Top holders’ token holdings and transactions reflect their token outlook. Tracking token buyers and sellers might help you trade.
Onchain capital flow monitoring may be most flexible. By tracking onchain flows and money, you may find alpha without tokens or addresses.
Blockchains record money transfers between addresses, therefore they save wallet transactions. Blockchain transactions include a unique ‘hash’ including the sender, recipient, timestamp, and amount. On-chain study includes money travel locations and times.
We can see the biggest token holders using chain analysis. Arkham and other block explorers examine blockchain data on users’ behalf and arrange the information to reveal the top token holders in a list.
Exchange flows are funds exchanged between exchange and non-exchange wallets. On-chain analysis indicates exchange net money. Analysts investigate trade movements over longer durations or for individual coins using this data.
Exchange inflows are typically considered ‘bearish’ since they indicate token sales. Taking tokens from exchanges to wallets indicates an intention to keep them longer, making it a positive or ‘bullish’ action.
Market players may utilize and transfer value across various blockchains using Ethereum Virtual Machine (EVM) compliant blockchains, Layer 2 scaling solutions, and Layer-1 blockchains.