Google searches for the term ‘Bitcoin’ have reached all time highs this month. The influx of searches correlates with a decline in queries for ‘Ethereum,’ reversing months of relative correlation between searches for both Bitcoin and Ethereum. Fluctuations in the volume of search queries for Bitcoin and related terms are viewed by many traders as a barometer of market sentiment.
In addition to Bitcoin’s continued success, reaching new all time highs recently, many are attributing the influx of search volume to the recent resolution of Bitcoin’s scaling debate, and alleviation of fears pertaining to a hard fork. The soft fork comprised the resolution of Bitcoin’s most significant fundamental uncertainty, reaffirming its status as the leading cryptocurrency project.
The decline in searches for Ethereum have likely been a consequence of several factors – including Bitcoin’s domination of cryptocurrency, recent hacks sustained by the Ethereum network serving to the interest of individuals outside of the cryptocurrency sphere, and the failure of the highly anticipated ‘flippening’ event (Ethereum overtaking Bitcoin in market cap). The decline in search volume also comes following several months of record breaking search volume, rendering the likelihood of an impending reduction in search traffic very high.
The inverse correlation regarding ‘Bitcoin’ and ‘Ethereum’ search traffic appears to be occurring in correlation with the total market capital of the entire cryptocurrency market.
Do you think that Google search trends can comprise an accurate representation of dynamics within the Bitcoin and Ethereum markets?
This article was first posted on Etoro.com/blog: Our Premium Trading Partner.
Last modified: March 4, 2021 4:58 PM