Crypto Market Poised to Enter 2nd Phase Amid Exclusive Liquidity Surge

As per the recent analysis by the on-chain analytics firm CryptoQuant, the crypto market might be moving closer to entering the 2^nd phase. As per CryptoQuant, this shift will drive a noteworthy boost in liquidity as well as the short-term holder supply, indicating trends formerly witnessed back in 2017. The analytics platform took to social media to provide details of this development.

Crypto Market to See a Transition to Phase 2 with an Increase in Capital Influx

In an exclusive report, the CryptoQuant analyst “Mignolet” mentioned that the crypto market is nearing entering Phase 2. The analyst pointed out that the respective transition is currently standing in a crucial condition. Mignolet added that entry to this phase would potentially boost the capital influx. In addition to this, it will also increase liquidity as well as the supply that the short-term investors hold.

A chief condition for the crypto market’s transition to the new phase deals with the spike in short-term supply. This will particularly result from an upsurge in the newly coming capital. The analyst disclosed that the market is witnessing plenty of new liquidity. This reportedly develops conditions required for the upcoming phase.

The market cycle’s 1^st phase took into account a collection of assets in the hands of long-term holders. However, they have now started disseminating the holdings. The respective behavior commonly occurs during the crypto bull market’s early phases. During such scenarios, experienced holders purchase assets at decreased prices and commence offloading while the latest investors enter the market.

The Current Conditions of the Crypto Market Resemble Those Seen during 2017’s Cycle

The CryptoQuant analyst further asserts that the present phase transition closely relates to the market structure that occurred during the 2017 cycle. At that point, the spiking liquidity from the exclusive investors ignited substantial price rallies throughout the big cryptocurrencies. This drove broad-level market enthusiasm along with raising trading activity.