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Optimism Network Activity Metrics Approach Record Levels, Propelling OP 9% Higher

Layer 2 (L2) scaling solution Optimism reported a series of strong network metrics in the first quarter (Q1) 2024, with its native OP token surging 9% on the back of this bullish momentum.

Optimism Sees Higher Activity And Rising Transaction Fees

According to a recent Messari report, Optimism’s circulating market cap increased 11% quarter-over-quarter (QoQ) to $3.7 billion, while its fully diluted market cap rose 1% to $15.7 billion. 

Despite the broader crypto market rally, with Bitcoin (BTC) and Ethereum (ETH) gaining 69% and 53% QoQ, respectively, OP’s market cap ranking slipped from 26th to 39th among all blockchain networks. However, within the Ethereum ecosystem, OP remains one of the top four rollups by market capitalization.

Optimism

Driving this growth was a significant uptick in Optimism network activity. Daily active addresses reached 89,000 in Q1 2024, a 23% QoQ increase, while daily transactions surged 39% to 470,000 over the same period. These metrics approached, but did not quite reach, their all-time highs in Q3 2023.

The network’s revenue also saw a substantial 78% QoQ increase to $16 million, driven by higher activity and a 48% rise in the average transaction fee to $0.42. However, this average fee dropped significantly in the latter half of March due to the implementation of Ethereum Improvement Proposal (EIP) 4844, which reduced L1 submission costs by 99%.

Total Value Locked Jumps 18% In Q1

Despite the fee reduction, Optimism’s on-chain profit for Q1 2024 increased 14% QoQ to $2 million. The network’s Total Value Locked (TVL) also grew by 18% to $1.2 billion, though its TVL ranking among all networks fell to 11th place.

Within Optimism’s TVL, the DeFi sector dominated, accounting for 86% of active addresses. According to Messari, non-fungible token (NFT) applications and gaming followed with 6.9% and 6.7%, respectively. 

TVL’s leading protocols included Synthetix ($307 million, +4% QoQ), Aave ($270 million, +52% QoQ), and Velodrome ($171 million, +10% QoQ).

Optimism’s stablecoin market capitalization also grew significantly, reaching $809 million (+32% QoQ) by the end of Q1 2024. Circle’s USDC stablecoin and Tether’s USDT made up most of this, with USDT seeing a 64% QoQ surge to $512 million, or 63% of the total stablecoin market cap on Optimism.

Optimism
OP Rebounds Alongside Crypto Market Resurgence

Despite Optimism’s strong performance across key metrics in Q1 2024, the network’s native token, OP, did not see a corresponding price increase at the end of Q1. Instead, OP followed the broader market downtrend, hitting an annual low of $1.80 just one month after hitting an all-time high of $4.84 in March. 

However, OP has followed suit as the overall cryptocurrency market has seen a resurgence of bullish momentum in the past few days. In the past 24 hours, the token has recorded a 9% price increase and a 3% uptick in the past week, currently trading at $2.56. 

Furthermore, CoinGecko data shows a 19% increase in OP’s trading volume over the past 48 hours, reaching $290 million.

Optimism

While this renewed bullish sentiment is encouraging, OP still trades 46% below its all-time high and faces significant resistance levels soon before a potential retest of this milestone. 

The first key resistance is at $2.65, followed by $2.90, which must be overcome before the token can push towards the $3.00 level. Conversely, the $2.34 support level has proven crucial and must be monitored closely in case of any bearish resurgence. 

Featured image from Shutterstock, chart from TradingView.com

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Market Downturn? Not For Optimism: A16z’s Major OP Purchase Sends Price Skyrocketing By 9%

In a month marked by a challenging correction in the crypto market, Layer 2 (L2) blockchain protocol Optimism has emerged as a standout performer. Within the past 24 hours, Optimism’s native OP token skyrocketed by 9%, positioning it as the best-performing token among the top 100 cryptocurrencies. 

Behind this surge lies venture capital firm a16z, which has reportedly invested around $90 million in Optimism’s OP token, signaling further institutional support for the layer 2 protocol. 

OP Receives Major Investment

Sources familiar with the matter have revealed to Unchained that a16z has acquired a significant stake in Optimism’s OP token. 

The investment, which comes with a two-year vesting period, underscores a16z’s interest in the Layer 2 protocol and aligns with its growing involvement in crypto. Notably, a16z’s portfolio already includes crypto exchange Coinbase. 

The investment by a16z comes amidst notable activity and growth within the Optimism ecosystem. Optimism’s OP Stack has experienced increased usage, further validating its value proposition. The protocol’s ability to increase scalability and reduce fees on the Ethereum blockchain has also garnered significant attention. 

Optimism’s spokesperson expressed enthusiasm for the investment, acknowledging the energy and momentum surrounding the protocol. The partnership with a venture capital firm like a16z is expected to fuel further development and innovation within the Optimism ecosystem.

On March 7, the Optimism Foundation disclosed the sale of approximately 19.5 million OP tokens, valued at nearly $90 million, to an undisclosed buyer. 

These tokens were reportedly sourced from a 30% pool of OP’s original treasury, dedicated to the foundation’s working budget. Reports indicated that the buyer could delegate their tokens to third parties, enabling them to participate in Optimism’s governance.

The foundation clarified that, due to the private nature of the sale, specific details regarding the terms and purchaser were not disclosed. 

Key Levels To Watch For Optimism

Despite the recent surge in the Optimism ecosystem and its native token OP, the token still trades well below its all-time high (ATH) reached on March 6, 2024, currently down over 47% from that level.

However, OP’s trading volume has experienced a notable surge, indicating continued interest in the token. According to CoinGecko data, the OP trading volume has increased by over 113% compared to the previous trading day on April 30, amounting to nearly $600 billion in 24 hours.

Optimism

Key levels to monitor for the token soon include OP’s significant resistance at the $2.62 price mark and a potential retest of the $3 zone. 

However, a clear indication of a positive trend for the Optimism token would require a successful consolidation above the $3.92 zone, marking the end of the month-and-a-half downtrend structure.

Conversely, the $2.37 zone has proven to be a crucial support level for OP, as it has held for the past five days and prevented further price decline for the token. 

Digging deeper, the $2.25 mark is also a key support, with the most critical support level at $2.11. This level holds the key to Optimism’s macro bullish structure, as it initiated the token’s current uptrend.

Featured image from Shutterstock, chart from TradingView.com 

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Analyst: OP Is Undervalued But Will Skyrocket Because Of Coinbase And Base

Adam Cochran, a partner and professor, is bullish about OP, the native token of Optimism, the layer-2 scaling solution for Ethereum. 

Taking to X, Cochran is convinced OP is undervalued, pointing to the significance of Coinbase and the brand it has created over the years as a crypto exchange and investor in multiple products. In 2023, Coinbase backed the development of Base, a layer-2 scaling solution for Ethereum that uses Optimism infrastructure for its optimistic roll-up. 

OP Will Rocket Because Of CoinBase And Base

In coming up with this assessment, the investor highlights Coinbase’s vast user base and ability to drive retail adoption towards Base potentially. And, as aforementioned, since Base uses Optimism, the expected adoption spike will significantly boost OP from current spot levels. 

Cochran argues that the “power of discoverability” associated with Coinbase, a brand that facilitates billions of dollars in daily trading, will be crucial to Optimism’s success. This is particularly relevant when looking at OP prices when writing.

OP price trending upward on the daily chart | Source: OPUSDT on Binance, TradingView

When writing, OP is stable but up 220% from October lows. The token has been trending higher, benefiting from the broader crypto rally. Even so, though in an uptrend, OP has not reclaimed 2023 highs of around $4.2.

To drive the point home, Cochran compares how the BNB Chain blew up in the number of active users. In the last bull run, the chain had an active decentralized finance (DeFi) and non-fungible token (NFT) ecosystem. The BNB Chain’s popularity and soft landing is because the smart contracts platform is associated with Binance, the world’s largest cryptocurrency exchange. 

Further to the point, the success of Solana, the partner argues, lends its success to the now-defunct FTX. At its peak, FTX injected billions to fund the development of Solana. It was also actively involved in financing some of Solana’s active protocols. 

The Great Convergence Of Supportive Events

Presently, Coinbase is streamlining its operations, recently stopping support for Bitcoin, Litecoin, and other UTXO tokens via Coinbase Commerce. Their focus is on Ethereum-compatible tokens, which could provide hints that Coinbase Commerce might soon be integrated into Base.

From the protocol level, Ethereum plans to implement upgrades to make transacting on layer-2 platforms even cheaper. The Dencun Upgrade is scheduled for March and will see Ethereum enhance as part of its long-term scaling roadmap.

Optimism TVL | Source: L2Beat

L2Beat data on March 1 shows that Optimism has a total value locked (TVL) of $7.8 billion, roughly half that of Arbitrum. Meanwhile, Base has been rising up the rankings, commanding a TVL of approximately $1 billion.

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Optimism Price Up By 34% Today – But Investors Should Watch Out For This Sell Signal

Optimism price has been witnessing significant momentum over the past few days, becoming one of the top gainers in the market today. Thanks to this recent price growth, Optimism has seen its native token OP lay a serious claim to a place within the top 30 cryptocurrencies by market capitalization.

However, it seems that the Optimism price movement may soon be turning bearish following the appearance of a sell signal on the price chart. 

Indicator That Preceded 80% Rally Turns Bearish, Analyst Says

In a recent post on the X platform, crypto analyst Ali Martinez sounded the sell alarm for the OP token. According to the popular crypto pundit, the Optimism price might be in the best range for investors to cash in on their profits.

The reasoning behind this forecast revolves around the TD (Tom DeMark) sequential indicator. Based on Martinez’s analysis, the indicator is currently flashing a sell signal on Optimism’s 12-hour price chart.

The crypto analyst highlighted that a buy signal from the TD sequential indicator preceded a substantial surge in Optimism price earlier in December. And this adds even more weight to the possibility of a bearish turnaround following a sell alarm from the indicator.

Martinez advised investors to think about taking profits right away, given that the OP price may decline and mirror the size of the initial bullish upswing. This projection comes during an exhilarating positive run for OP, putting the altcoin’s bullish trajectory in jeopardy. 

Optimism Price And Network Growth

As of this writing, the Optimism price stands at $3.37, reflecting an almost 34% price increase in the past 24 hours. According to data from CoinGecko, the value of the cryptocurrency has soared by more than 55% in the past week.

The OP coin looks set to end the year as one of the 30 largest cryptocurrencies in the sector, with its market cap recently surpassing $3 billion. This positive performance of the token – in such a short time span – only underscores the increased rate of network growth.

According to recent data from IntoTheBlock, the Optimism network boasts more than 5.9 million addresses with a balance. This represents a nearly 400% surge from 1.2 million in January 2023.

Growth of this caliber and magnitude suggests increased confidence, adoption, and usage of the Optimism network. And if this positive trend is anything to go by, there is a chance the Optimism price won’t be down for long – if the current bearish projection does come true.

Optimism Price

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Optimism Price To Resume Bullish Trajectory To $3? Here’s How

The Optimism price appears to have struggled over the past week, with its recent bullish momentum seemingly waning. During the altcoin rally, the price of Optimism’s native token OP went from a low of $1.2 to a high of nearly $2.5 before experiencing a pullback. 

While OP has managed to preserve a majority of its recently accrued profit, the cryptocurrency seems to be finding it challenging to continue its bullish trajectory. And the latest on-chain revelation suggests that there might be only one thing in the way of the Optimism price rise to a new high.

OP Price To Soar By 26% To $2.70, Crypto Analyst Projects

Popular crypto analyst Ali Martinez, in a recent post on the X platform, disclosed his bullish projection for the price of Optimism over the next few weeks. This prediction revolves around on-chain data from IntoTheBlock, which is based on the density of investors who purchased the OP token at certain price zones.

Optimism Price

The chart above displays how the Optimism price zones around the current value look in terms of investor density. The size of the dot indicates the number of investors who bought the OP coin at each price range. Notably, the resistance or support at a price zone is more significant the larger the dot size of that price zone.

In his post, Martinez pointed out that the Optimism price is currently bouncing off a major resistance zone between $2.17 and $2.30. According to data from the analytics platform, roughly 27,000 addresses purchased a massive 45 million tokens within this range.

Martinez posited that the zone between $2.17 and $2.30 is one to watch out for, given the substantial buying activity within the price range. “A sustained close above could signal a bullish breakout, potentially propelling OP toward $2.70,” the crypto analyst said. This represents a more than 26% price growth from the cryptocurrency’s current value.

Optimism Price Overview

As of this writing, the Optimism price stands at $2.11, reflecting a 2.4% price decline in the past 24 hours. OP’s sluggish performance in the past day underscores the altcoin’s struggles over the past week.

According to data from CoinGecko, the Optimism price has barely changed in the past seven days. Although the cryptocurrency surged to a multi-month high of $2.46 earlier in the previous week, it has since faced some level of correction to trade around $2.10.

Nevertheless, Optimism still ranks amongst the top 40 cryptocurrencies in the sector, with a market capitalization of roughly $1.94 billion.

Optimism Price

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Optimism Edges Other L2s In Gas Efficiency, Despite Loss In TVL, Revenue

Optimism (OP) has opened the year on an optimistic note as it enjoys a bull run. On the flip side, it has suffered sluggishness in terms of total value locked (TVL).

Here’s a quick snapshot of Optimism:

  •   OP price spikes by 5.76%
  •   OP down in terms of TVL; now only $500 million
  •   Users save as much as 99.4% on ETH

Arbitrum is seen to have blazed past the other leading Layer 2 blockchains including Optimism and Polygon when it comes to TVL. Regardless, the former remains unfazed as it still accelerates in tempo and dominates the L2 space.

Optimism On A Bull Run

According to CoinMarketCap, OP price is up by 5.76% or trading at $1.02 as of press time. On the contrary, its TVL isn’t too impressive as it dwindled down $550 million to now only $511 million as seen in the past 30 days, which also negatively impacted revenue.

The term “Layer 2” is used to describe an additional framework or protocol that is implemented on top of an existing blockchain system.

These methods are designed to address the problems of transaction throughput and scalability being experienced by the most prominent bitcoin networks.

Optimism has been swinging and switching back and forth to higher lows and bullish highs. Evidently, OP price has spiked by as much as 15% overnight and is now green with the price range at $1.02.

In the event that the bulls can hold on to its optimistic price momentum, Optimism could shoot to as much as $1.45 in the coming days.

Can OP Barrel Past Key Resistance?

There is an increased positive price action seen with Optimism as it is predicted to rally to as much as $1.53 in the next couple of weeks, and barreling past the key resistance. OP is going through an obvious uptrend and could retest the key resistance zone at $1.45.

Meanwhile, Optimism has the ace in terms of gas efficiency compared to its rivals. One of the perceived reasons behind the incrementing growth usage on Ethereum is that users can save more ETH whenever they use Optimism. 

Optimism was able to use less gas than other L2s, despite having a lower TVL and lower income, as reported by Dune Analytics. Even when compared to Arbitrum, the Layer 2 solution performed better.

Customers’ aggregated savings from using Optimism for transactions also kept rising. As of this writing, the Ethereum scaling solution helped its customers save up to 98%.

OP’s network, on the other hand, is faltering in terms of growth which hints the plunge in transactions and new user addresses. More so, development activity has also declined which could get in the way of its chances to attract new users.

On the brighter side, OP is spiking in terms of market capitalization as it is up by 6.74%.

-Featured image: The Coin Republic