How to protect yourself from cryptocurrency price manipulation traps
Discover how On-Chain Analysis can safeguard your investments from market manipulation. Learn to use valueble assistants like BlockchainMetrics to gain awareness of performance indicators and avoid speculative traps. Equip yourself with the tools to make informed, savvy investment decisions with practical insights from CosmosHub and BNB token case studies.
This article is a continuation of the ideas presented in the previous work.
Let us remind you that from this document you could gather for yourself that By monitoring listed above key indicators, you can assess a platform’s development dynamics — how well it’s progressing in the current period. This comprehensive analysis, available at Blockchainmetrics, ensures you stay informed and make savvy investment decisions. If you haven’t read this article, I highly recommend checking it out.
In this material, let’s look at a specific example of how regular and thoughtful analysis helps protect against unscrupulous market manipulators for profit. In the context of health, growth and adoption of a blockchain network, it is fundamentally important to gain insights into wallet activity, transaction volume and other on-chain metrics. This practice is called On-Chain Analysis. And when it comes to long-term blockchain investments, it is not replaceable Because in a long term perspective, these metrics are less influenceable by market sentiments and speculators pressure. In the blockchain world On-Chain metrics are a kind of real sector of the economy. From this perspective, if this real sector grows, then the economy of the blockchain project will grow. It has sense, hasn’t it?
Today we will try to figure out with assistance of On-Chain Metrics provided by https://blockchainmetrics.online how you can avoid falling into the trap of manipulating price increases.
This chart shows the ATOM token price chart from the beginning of the year. This chart also shows schematically the results of on-chain analytics for several months.
Or the same thing but in a table view:
What can be seen from this analytics:
- improvement in the on-chain metric of the blockchain precedes an increase in price.
It’s easy to explain. The activity of speculators increases, who impacts to surge the price. The maneuver procedure begins.
2. deterioration of the blockchain’s on-chain metrics precedes a price decrease.
the poor “economics” of blockchain suggests that the price increase is due solely to speculative and manipulative factors. Most likely, at the same time, a series of messages about how attractive this crypto-project is and what fantastic prospects it has, will be promoted on social networks . Not necessarily immediately, but after some period of time the price will inevitably fall to the level from which the “acceleration” began.
3. CosmosHub is a bad option for long-term investing, despite the fact that they offer a good staking yeid.
And now, as a bonus, similar analytics for the BNB token.
Here is the same graph of price fluctuations since the beginning of the year. This chart also shows schematically the results of on-chain analytics over the past few months.
And this is what we observe:
What can be seen from this table:
- for several months now, the BNB token has had deteriorating on-chain metrics
Despite this, the price of the token made a sharp jump in June, reaching ATH. However, everything suggests that such growth is in no way supported by the “real sector” of the operational indicators of the blockchain platform.
We will not make any forecasts on expected prices within the framework of public materials here.
We invite readers to draw their own deductions.
Conclusions.
The article emphasizes the critical role of On-Chain Analysis in assessing blockchain investments. On-chain metrics are presented as real indicators of a blockchain platform’s performance, offering a clear picture of its health, growth, and adoption. By skillfully analyzing these metrics, investors can avoid the pitfalls of market manipulation by professional speculators.
The example of the CosmosHub blockchain token illustrates that despite its good staking yields, it should not be considered a viable long-term investment due to its poor on-chain metrics. Similarly, the current significant increase in the BNB token price is shown to be unsupported by strong on-chain metrics, suggesting speculative manipulation rather than genuine growth.
Overall, the article underscores that comprehensive analysis, such as that provided by BlockchainMetrics, equips investors with the knowledge to make informed and savvy investment decisions, steering clear of speculative traps and focusing on long-term potential based on robust on-chain data.
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