Posted on

MATIC Price Rally Threatened As Whales Deposit Millions Of Tokens To Exchanges

Bitcoin has recovered over the last day after gaining momentum from the Valkyrie Ethereum ETF news and pulling up the likes of the MATIC price. This has led to a rare green day for the cryptocurrency market in as many months but MATIC may not be able to hold as well as other altcoins as whales make their move.

Whales Move Tens Of Millions To Exchanges

The first notable whale transaction involving MATIC was flagged by Lookonchain on Wednesday. The transaction was carrying 10.78 million tokens at the time worth around $5.5 million.

Mostly, it was the destination of these tokens that was important which turned out to be the Binance crypto exchange. The whale looked to have deposited the tokens to sell them as the MATIC price had taken a quick 3% dive following the deposit.

MATIC would later recover and move into the green, a price increase that seemed to have prompted more whales to take advantage of the situation. Over the course of the day, whale transaction tracker Whale Alert would report multiple whale transactions all carrying millions of dollars worth of the token toward exchanges.

The next large transaction was one carrying 11,000,888 tokens worth $5.7 million to the Binance exchange. Another transaction followed shortly carrying the exact number of MATIC tokens also headed for the Binance exchange.

Within the same hour, the whale tracker also reported 15,826,267 million MATIC being shifted once again to Binance. This transition was carrying approximately $8.2 million worth of tokens. This pointed toward whales looking to dump large portions of holdings.

Polygon MATIC price chart from Tradingview.com (MATIC whales)

MATIC Price Could Suffer Drawdown

The massive amounts of tokens being shifted toward centralized exchanges could mean that the whales are beginning to offload some of their holdings to avoid further losses. In this case, it is not farfetched to say that the altcoin’s rally over the last day might be a brief one. Such a fall could easily see the MATIC price fall back to $0.51 as bears retest the support at $0.5.

However, all hope is not lost for the MATIC price as the coin still holds some bullishness. As one TradingView analyst points out, if the altcoin is able to break out from its current descending triangle, then the price could rally over 50%.

MATIC price prediction chart from Tradingview.com

The analyst puts the first target of this rally at the $0.9 level as well, which is an almost 100% price increase from here. But MATIC will continue to face opposition from bears, making it a tricky situation.

At the time of writing, the MATIC price is resting above $0.5232, enjoying 3.06% gains in the last day.

Posted on

MakerDAO Secures $6 Billion For Treasury Bill Investments As MKR Dominates 2023

According to a Bloomberg report, MakerDAO, one of the prominent decentralized lenders in cryptocurrency, has reaffirmed its decision to invest billions of dollars in US government bonds.

This strategic move has propelled its governance coin, MKR, to reach its highest level since April 2022, outperforming other major cryptocurrencies, including Bitcoin (BTC).

MKR has experienced a remarkable surge of 77% this quarter, emerging as the best-performing cryptocurrency of the year. Despite a modest decline of 3.9% to $1,452 on Friday, the coin has nearly tripled in value. 

MakerDAO Doubles Down On Treasury Bonds

As per DefiLlama data, MakerDAO currently oversees $4.6 billion in assets. The rally of MKR can be attributed to MakerDAO’s 2022 decision to convert the backing funds of its stablecoin DAI into assets such as short-term US Treasuries and corporate bonds. 

This strategic shift aimed to seek more stable yields amid the downturn in the cryptocurrency markets. Subsequently, MakerDAO passed a proposal enabling the investment of up to $6 billion in short-term Treasuries, doubling the existing limit.

Simon Peters, an analyst at investment platform eToro, suggests that the recent gains in MKR can be attributed to rising treasury yields following the Federal Reserve’s indication of keeping rates higher for longer.

However, signs of a potential slowdown in the MKR rally have emerged. CryptoQuant data reveals a gradual increase in MKR tokens held on centralized exchanges (CEX), indicating that some traders are preparing to secure profits from the recent surge. 

Notably, the drop experienced on September 29 ahead of the monthly close marked the largest decline since mid-September.

According to Bloomberg, the trader enthusiasm for MKR has extended to DAI, MakerDAO’s stablecoin. DAI’s circulation has grown from a low of $3.9 billion on August 20 to $5.5 billion. 

Furthermore, MakerDAO introduced a limited-time offer of an 8% annual yield to DAI holders, which, combined with the approval of the investment proposal, could potentially trigger a fresh wave of buying in short-term Treasuries.

Allan Pedersen, the CEO of Monetalis, a firm assisting MakerDAO in its investments, expressed that if the supply of DAI continues to increase, it could lead to a significant expansion of MakerDAO’s T-bill investments in a short time frame.

The developments surrounding MakerDAO’s investment strategy in US government bonds, which have propelled MKR to new heights, signify a calculated move to achieve stability and sustainable yields by the decentralized protocol.

MKR Hits 18-Month High

MKR has declined over 4.5% in the past 24 hours, causing the token to retrace to its current trading price of $1,452. However, over the last month, MKR has exhibited consistent gains across various time frames, with notable increases of 12%, 19%, and nearly 40% over the seven, fourteen, and thirty-day periods, respectively.

Furthermore, MKR has reached an impressive 18-month high, surging by 101% year to date and briefly peaking at $1,590 earlier on Friday.

MakerDAO

In the short term, safeguarding against an extended decline, MKR has two crucial support levels that bulls must defend. The first immediate support rests at $1,430, while the second support level, spanning two months, is positioned at $1,341.

Meanwhile, MakerDAO and its ecosystem appear poised for further gains with their investment strategy. With a few months remaining in 2023, there is a potential for MKR to conclude the year as the top-performing asset if the ongoing rally continues.

Featured image from Shutterstock, chart from TradingView.com

Posted on

Bitcoin Surge Above $27,000 May Not Last, Here’s Why

Bitcoin has broken back above the $27,000 level during the past day, but if on-chain data is to go by, this surge may not last for long.

Bitcoin Investors Are Taking Profits At Highest Rate In 3 Months

According to data from the on-chain analytics firm Santiment, there is a chance that a short-term correction could happen for the cryptocurrency. The relevant metric here is the “ratio of daily on-chain transaction volume in profit to loss,” which, as its name suggests, tells us about how the profit-taking volume compares against the loss-taking volume on the Bitcoin network right now.

This indicator works by going through the transaction history of each coin being sold/transferred on the blockchain to see what price it was moved at before. If this previous selling price for any coin was less than the current spot price, then that coin is being sold at a profit right now.

The sale of all such tokens would contribute toward the Bitcoin profit-taking volume, while coins of the opposite type would add towards the loss-taking volume.

Now, here is a chart that shows the trend in this BTC metric over the past few months:

Bitcoin Profit-Taking Volume

As displayed in the above graph, this Bitcoin indicator has observed a large spike as the cryptocurrency’s price itself has seen a surge beyond the $27,000 mark and has reached a value of 2.51.

When the metric has a value greater than zero, it means that the profit-taking volume is more than the loss-taking volume. On the other hand, values under this threshold suggest the dominance of loss-taking.

At the current value of 2.51, the profit-taking volume outweighs the loss-taking one by 3.51 to 1. This disparity between these two volumes is the highest it has been since around three months ago.

Historically, intense profit-taking has usually resulted in at least a short-term top for Bitcoin, so it’s possible that the current values of the metric would also result in a correction for the price.

In the chart, Santiment has also attached the data for the “Market Value to Realized Value (MVRV) ratio,” which keeps track of the difference between the Bitcoin market cap and realized cap.

The latter of these is basically a measure of the total amount of capital that the investors as a whole have put into the cryptocurrency, so this metric tells us how the value that the holders are carrying currently compares with their total investment.

From the graph, it’s visible that the 7-day Bitcoin MVRV ratio has turned notably positive with this rise, which implies that the investors are carrying profits at the moment.

The analytics firm notes that this metric going back below zero would be ideal for the next leg up, as the holders being in loss would lead to an exhaustion of the profit-sellers.

BTC Price

So far, despite the aggressive profit-taking happening in the market, Bitcoin has managed to hold above the $27,000 mark.

Bitcoin Price Chart