Transaction velocity measures how often tokens are exchanged within a period, indicating market activity, speculation, and adoption. High velocity can suggest active trading, short-term speculation, or low holding incentives, while low velocity indicates long-term holding and ecosystem trust. Analysts combine velocity with staking, wallet concentration, and liquidity data to predict price trends and potential sell pressure. Monitoring velocity also helps assess the effectiveness of incentive programs and tokenomics designs. For researchers, understanding velocity provides insights into behavioral patterns, market sentiment, and ecosystem health, supporting accurate forecasting and informed investment decisions in both DeFi and NFT markets.
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CEX-to-DEX volume ratios reflect trust in centralized exchanges. A surge in DEX volumes after security incidents may indicate users shifting toward self-custody, affecting liquidity distribution across the market.
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A surge in meme coin volumes can divert liquidity from major assets, creating short-term pressure on BTC and ETH. Such speculative frenzies often end with capital rotation back into more established coins, sometimes sparking mini-altseasons after the meme trend fades.
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