Toncoin Sharpe Ratio Is Falling: What It Means And — Is It Time To Buy?
27 Outubro 2024 - 6:30AM
NEWSBTC
Toncoin, which is one of the best-performing cryptocurrencies in
2024, has also been affected in recent months by the widespread
bearish climate of the market. The price of the altcoin seems to be
recovering nicely after suffering an abrupt decline on Friday,
October 26. As of this writing, the value of Toncoin stands
around $4.92, reflecting an almost 3% upswing in the past day.
However, this single-day action has had minimal impact on the
token’s performance on the weekly timeframe. According to data from
CoinGecko, the TON price is down by nearly 7% in the past week.
What Does The Declining Sharpe Ratio Mean? In a recent Quicktake
post on the CryptoQuant platform, an analyst with the pseudonym
Darkfost explained the relevance of the “Sharpe Ratio” metric to
cryptocurrency price. According to the crypto pundit, the Sharpe
Ratio for Toncoin has been in decline in recent weeks, signaling a
period of decreased risk. Related Reading: Dogecoin Price Flashes
Bullish Pennant On Daily Heikin Ashi Chart, What This Means The
relevant metric here is the Sharpe Ratio, which assesses the
risk-adjusted returns of an investment. This indicator basically
measures how much profit an investment offers per unit of risk
(considering risk is quantified by volatility). Typically, a rising
Sharpe Ratio signals a higher risk-adjusted performance. On the
other hand, when this metric is in a downward trend, it implies
that the coin is in a “lower-risk zone” and profits are becoming
less significant. According to Darkfost, it appears that both
volatility and risk are decreasing for Toncoin, as its Sharpe Ratio
continues to fall. With the altcoin showing reduced sensitivity to
price fluctuations, it offers a more favorable risk-return balance
and a less risky market for investors. A less volatile market
condition may be ideal for Toncoin investors to accumulate tokens
with less exposure to abrupt price movements. The Quicktake
analyst, however, warned investors to approach the market with
caution as the “lower-risk zone” may not be completely safe.
Darkfost specifically advised investors to still watch out for
Bitcoin’s price movements, as the market tends to respond to swings
from the premier cryptocurrency. Toncoin To Overtake Ethereum In
This Metric Before 2025 In a separate Quicktake post, an analyst
has projected Toncoin to overtake Ethereum in terms of adoption
before the end of 2024. According to Maartunn, the number of TON
holders, which currently stands at 112 million, is expected to
surpass ETH holders by December 20, 2024. This projection is based
on Toncoin’s recent growth spurt, which has seen the network gain
an average of 500,000 new holders daily over the past month.
According to the Quicktake analyst, the number of TON holders could
exceed that of Ethereum (currently 137 million) if this trend
continues. Related Reading: Would Bitcoin Reclaim $70,000 Soon? Key
Data Suggests New Investors Hold the Key However, Maartunn noted
that this prediction doesn’t account for the potential of a
slowdown in TON’s growth rate and the continuous growth of ETH
holders. The analyst acknowledged that while these two factors are
only variables, they may still influence the projected dates.
Featured image from Unsplash, chart from TradingView
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