JOEUSDT Archives

Is Trader Joe Undervalued Relative To Uniswap?

In a post on X on December 12, Davis noted a discrepancy in the relative valuation between JOE and UNI, which serve as governance tokens of Uniswap and Trader Joe. Specifically, the investors noted that Trader Joe’s handles around $300 million daily trading volume on Avalanche alone.

On the other hand, Uniswap processes approximately $1.6 billion in daily volume across the Ethereum mainnet and Arbitrum, the largest layer-2 platform by total value locked (TVL) by Ethereum.

Davis further noted that despite this “small” difference in trading volume, Trader Joe’s has a market capitalization of only $238 million. Meanwhile, Uniswap has a market cap of $3.6 billion, according to CoinMarketCap data.

Even with relatively narrow average trading volume, the huge difference in market capitalization suggests that JOE is significantly undervalued relative to UNI. Accordingly, this gap will likely be narrowed in the future, with JOE appreciating versus UNI, possibly benefiting holders.

JOE Yields Versus UNI’s Governance: Which Token Has An Edge?

Davis also pointed out JOE’s potential, saying the token rewards holders with USDC yields. This is different from UNI, where holders can vote on proposals and nothing else. In the investor’s preview, besides the undervaluation, this feature could further enhance JOE’s appeal, even contributing to its upside potential.

As the crypto market recovers, Avalanche might also present additional advantages to traders and, therefore, Trader Joe. The modern blockchain is scalable and has relatively low fees regardless of network activity. With crypto prices expanding, Ethereum gas fees have been rising in tandem, discouraging mainnet transfers. This has rerouted activity to layer-2s like Arbitrum and competing platforms, including Avalanche.

Trader Joe price trending upward on the daily chart | Source: JOEUSDT on Binance, TradingView

When writing on December 12, DeFiLlama data shows that Trader Joe has a TVL of $149 million, of which most assets are tied to Avalanche. Only $1 million is on Ethereum. JOE has been on an uptrend, rising 170% from October 2023 lows. The token is cooling off, looking at price action on the daily chart.

Trader Joe’s, a well-known supermarket chain in the United States, has taken legal action against a decentralized exchange (DEX) platform named Trader Joe, alleging that it has violated federal trademark laws.

The DEX platform, which operates under the domain name traderjoexyz.com, not only shares the same name as the supermarket but, according to recent reports, also appears to be trying to leverage the supermarket’s established brand and reputation.

US Supermarket Giant Locks Horns With Trader Joe DEX

Trader Joe’s has gained popularity in the digital realm by initially launching on the Avalanche (AVAX) network and later expanding its presence to BNB Chain, Arbitrum (ARB), and Ethereum (ETH).

It currently holds over $77 million worth of tokens across various chains and has processed trades amounting to $25 million in September alone.

However, its success has been overshadowed by a heated dispute regarding the origin of its brand and allegations of fraudulent attempts to misrepresent its origins.

Trader Joe’s supermarket chain has grown increasingly frustrated by the lack of response to its requests to cease the misuse of its trademark. As a result, the matter has escalated internationally, and a complaint was filed with the World Intellectual Property Organization (WIPO) in May 2022 to force the crypto entity to relinquish its domain name.

Furthermore, recently filed court documents in the US District Court for the Central District of California shed light on the proceedings at WIPO. According to these documents, the defendants presented a false narrative that distorted the true origins of “Trader Joe’s.”

They claimed that the platform was named after the co-founder’s brother, a claim that Trader Joe’s supermarket chain has vehemently denied.

JOE Token Plummets In Value Amidst Legal Battle

Trader Joe DEX has recently seen notable variations in several critical metrics, with shifts in trading volume, market capitalization, revenue, and total value locked.

Over the past 24 hours, Trader Joe’s experienced a decline of 1.68% in its performance. This short-term dip in value has been reflected in the platform’s seven-day performance, with a 3.85% decrease.

However, despite these recent setbacks, the DEX has managed to maintain relative stability over 30 days, with a modest decline of 1.04%.

Trader Joe

According to Token Terminal data, one of the most striking figures is the platform’s 180-day performance, which shows a significant drop of 60.82%.

Nevertheless, when considering market capitalization, Trader Joe’s DEX boasts a circulating market cap of $90.84 million, indicating its prominence within the DEX ecosystem.

Moreover, the platform has shown a positive trend, with a recent increase of 2.26%. Total value locked (TVL) is another crucial metric used to assess the health and popularity of a DEX platform. Despite the recent market fluctuations, Trader Joe DEX continues demonstrating a TVL of $78.66 million.

However, it experienced a decline of 4.54%, suggesting a potential shift in user participation and liquidity within the platform.

Finally, trading volume, an essential measure of a platform’s activity, has witnessed a significant annualized decrease of 18.45%, amounting to $7.61 billion. This decline in trading volume raises concerns about engagement and participation on the Trader Joe DEX platform.

Featured image from Shutterstock chart from TradingView.com