ApeCoin (APE), created by Yuga Labs, once soared to great heights, capturing the attention of investors and enthusiasts alike. However, recent developments have cast a dark cloud over the once-promising digital asset.
With an astonishing 95% of ApeCoin holders finding themselves deep in the red, the future of this innovative cryptocurrency hangs in the balance.
Negative sentiment surrounding ApeCoin has become a prominent concern for its community. Once buoyed by optimism and excitement, investors now face frustration as their holdings plummet in value.
This loss of confidence not only undermines ApeCoin’s credibility but also raises questions about its long-term sustainability.
Diminishing Network Growth, Trading Velocity Compound APE’s Challenges
Founder of NotLarvaLabs, Pauly, has revealed a troubling statistic: an alarming 95% of ApeCoin holders are currently grappling with financial losses, painting a bleak picture for the once-promising cryptocurrency.
Looks like @apecoin is already right around it’s all time low price.
Over 95% of the holders are already at a loss.
And the @yugalabs team, insiders and “launch contributors” are paying themselves 10s of millions of dollars a month in $ape.
— PAULY (@Pauly0x) June 7, 2023
ApeCoin’s price decline can be primarily attributed to the diminishing growth of its network, which has witnessed a noticeable decrease in interest from new addresses over the past three months. This decline in interest reflects a diminishing enthusiasm for APE among potential investors.
In addition to the decline in network growth, ApeCoin’s trading velocity, which measures the frequency of transactions, has also experienced a significant drop during this period.
This decline in trading activity further exacerbates the challenges faced by ApeCoin, indicating a lack of liquidity and reduced participation in the market.
As per the latest information from CoinGecko, ApeCoin is currently priced at $2.90, with a marginal 24-hour rally of 0.2%. However, the cryptocurrency has undergone a notable decline of 6.6% over the past seven days, underscoring the volatility and uncertainty surrounding its value.
Whale Interest Persists Amidst ApeCoin’s Struggles
Interestingly, despite the aforementioned challenges, there remains a glimmer of interest in ApeCoin from influential investors known as whales.
These large addresses continue to demonstrate their engagement with APE, as evidenced by the increasing percentage of ApeCoin held by them.
This suggests that some prominent investors still perceive potential in the cryptocurrency, although the impact of their involvement on ApeCoin’s overall trajectory remains uncertain.
Bitcoin halfway from the $27K territory. BTCUSD chart: TradingView.com
MVRV Ratio Declines As APE’s Price Drops
The falling price of APE has had a direct impact on its MVRV (Market Value to Realized Value) ratio, indicating that a considerable number of APE holders lack significant incentives to sell their holdings at the current juncture.
This decline in the MVRV ratio raises concerns about the selling pressure on APE and suggests that many investors are reluctant to part ways with their APE tokens while the price remains low.
Meanwhile, the sell-offs by short-term holders could create additional downward pressure on APE’s price and further exacerbate the challenges faced by the cryptocurrency.
(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk)
Featured image from iStock
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