Data of Santiment, Grayscale: Ethereum, BAT, MKR could outperform Bitcoin in short term

  • The data analysis company Santiment is predecting a short-term rally for Ethereum, Basic Attention Token and Maker versus Bitcoin (BTC).
  • Messari reports that investors are paying a 750% premium for Grayscale Ethereum Trust to obtain ETH.

The data analysis firm Santiment has published a report on the performance of three altcoins, comparing them to Bitcoin. According to Santiment, there are 3 altcoins are poised to outperform Bitcoin, at least in the short term. The altcoins are Ethereum (ETH), Basic Attention Token (BAT) and Maker (MKR).

Santiment evaluated the three-day average of Bitcoin and the above-mentioned altcoins on the basis of three indicators: Daily active addresses (DAA) versus price divergence, network value to transaction radius (NVT), Sentiment Volume Consumed. The data analysis company then rated the cryptocurrencies from 0 to 10 to determine whether the trend is bearish or bullish. 10 is the most bullish rating.

In that sense, the data analysis firm rated Bitcoin as “slightly bearish”. BTC scored 3 on the DAA versus Price Divergence metric, 2 on the NVT metric, and finally 6.5 on the Sentiment Volume Consumed. On average Bitcoin scored 3.8.

In comparison, Basic Attention Token scored 8.5 on the DAA vs. Price Divergence metric, 9.5 on NVT and 6.0 on Sentiment Volume Consumed, with an average of 8.  Ethereum has more modest metrics, according to Santiment. The cryptocurrency scored a 5 on the DAA versus Price Divergence metric, 5.5 on NVT and 6 on Sentiment Volume Consumed. For that, Santiment gives it a neutral rating.

On the other hand, Maker scored a 9, 10 and 5.5 on the AAD versus Price Divergence, NVT and Sentiment Volume Consumed metrics respectively. This places MKR in the ranking with an average of 8.2 the most bullish. However, the analyst firm warns that these predictions are susceptible to change and that Bitcoin hast to stay in the $9,500 to $10,000 range for profit opportunities.

Institutional investors buy Ethereum with a massive premium

Despite the modest rating given by Santiment, Ethereum seems to be on a bullish path. According to research firm Messari, Grayscale is selling the ETH it has been accumulating over the course of 2020 with a massive premium. Investors of the Grayscale Ethereum Trust (ETHE) are paying a 750% premium for exposure to ETH. Messari states the following:

Secondary market investors are buying ETHE’s underlying ETH at an implied price of $2,095. 46% above ETH’s all-time high. 

The demand for ETH could be mainly motivated by the launch of phase 0 of Ethereum 2.0 which is expected to take place sometime this year. The update will initiate the upgrade of the Ethereum protocol from a Proof of Work to a Proof of Stake consensus. Therefore, ETH will become an asset that will give passive returns to investors.

However, Messari researcher Ryan Watkins warns that investors could be exposing themselves to excessive volatility. Watkins explains the following about the premium of the Grayscale Ethereum Trust:

The premiums not only cause secondary market investors to buy ETH exposure at absurd prices, but also exposes them to excess volatility given the fluctuating premiums.

About Author


Reynaldo Marquez has closely followed the growth of Bitcoin and blockchain technology since 2016. He has since worked as a columnist on crypto coins covering advances, falls and rises in the market, bifurcations and developments. He believes that crypto coins and blockchain technology will have a great positive impact on people's lives.

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