Bitcoin gaining momentum has been a good time for the alts to rebound. During the past week, when the altcoin market capitalization exploded for an 18% bullish move, there was speculation that a potentially stronger rally would take place in the future.
In the midst of this gala time, it was predictable that the alts would see high sentiment scores and buzzes of attention. However, the fact that Stellar (XLM) and Binance Coin (BNB) would lead this race came as a shock to many.
Riding on a high social sentiment
A recent report looked at the total sentiment score of some cryptocurrencies. He highlighted that Stellar claimed first place with a sentiment score of 40 and an attention buzz of 12%. BNB came in second with a sentiment score of 37.
In particular, the buzz of attention surrounding Dogecoin dropped by 20% over the past week. Chainlink and Ethereum maintained their place in the top five with sentiment scores of 35 and 34, respectively.
At the time of writing, XLM was near a multi-month high of $ 0.419 and BNB was just 42.55% of its ATH. Ergo, is this buzz of attention and a high sentiment score enough to keep these alts afloat?
Without a doubt, social sentiment is good for assets, but it cannot outshine the strength and functionality of the network. And, both BNB and XLM have fallen short in these respects in the recent past. In fact, a Nasdaq Article noted how XLM needs to “offer more than cheap money transfers if it is to gain widespread acceptance.”
As investors continue to place their bets based on breakthrough utility, XLM and BNB missed the same, while blockchains like Solana capitalized on the opportunity which, in turn, also resurrected their price.
This is missing in BNB and XLM
Solana’s dramatic push to establish itself as the eighth largest coin by market cap sparked a conversation about rebounding the alts in the near future. While expectations for other alts rose, the fact that SOL’s standalone recovery was fueled by its long-term growth in development activity was overshadowed.
Now, even though XLM experienced a lot of development activity along with its price appreciation, the recent discontinuity in it has been an annoying trend.
In particular, both BNB and XLM had a high development activity during the last days. This influenced the appreciation of prices.
However, the drop in it at the time of publication meant a reversal in development activity. Additionally, when it comes to development activity for a sustained rally, a steady growth of it, as seen in the case of Solana, is ideal for currencies. For both BNB and XLM, this is missing.
Also, both had much lower ROIs despite recent advancements, compared to some of the other major alts.
Both Stellar and BNB also saw a drop in their market cap dominance alongside high prices. In fact, Stellar’s market cap dominance was as low as in 2017. To reverse this, Stellar would need a strong push from the development side.
This is a machine translation of our English version.
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