Cryptic ball: let the majors wake up.
Another interesting couple of days, with bitcoin having recovered the key $47k support level. Ether is also on the move, currently trying to reclaim the equivalent $3.5k support. This makes us feel bullish for the week ahead, even though we are still confident the week will be uneventful. Why's that? As anticipated, SOL continued to fade, slowly dumping for six days in a row until it found support on the 20-day MA. But it could have been the mother of all dumps! Why?
Solana's blockchain was down for almost 20 hours, starting from Tuesday early afternoon UTC. The problem was due to extreme demand for a recent IDO - an Initial DEX Offering, where a new cryptoasset is launched on a decentralised exchange. This IDO was powered by Raydium, one of Solana's most popular DEXs. And that excess demand was caused by bots who were submitting up to 400,000 transfers per second to the blockchain, which "only" has an announced capacity of 50,000 TPS. So, why wasn't this catastrophic for SOL's price?
Chart art: but note they are boring.
Market musings: let beta networks grow.
It could have been! It definitely had the potential, and SOL continued trading during the time in which the network failed to produce blocks. Moreover, in the past, several blockchains suffering downtime were aggressively shorted! This raised the probable hypothesis that some Solana investors bought the dip (it was down 18% on the day at a certain point) to prevent the blockchain to come back online at a level that could potentially ruin its emergent DeFi ecosystem.
Anyway, if during a bull season a project doesn't react to FUD then it's either dead or solid (note that a great hallmark of a change in macro trend is when, in euphoric times, a major coin starts crashing in response to FUD, as the fresh fear highlights the lack of buyers who are still willing to continue pumping an asset)! Anyway, you know we like SOL since we first talked about it in April. But note we feel it will remain a bit dull until it confidently conquers $180 again.
Visual block: but note their centralisation levels.
Three things: let new tokens launch.
- When the sun isn't shining you should learn about more Ethereum killers! So check out Cosmos' top projects, courtesy of DeFi Times.
- When the sun isn't shining take a moment to learn about the original blockchain and its massive Taproot upgrade, due this November.
- When the sun isn't shining it's time to learn "How To Think About Token Generation Events Using DeFi", from IDOs and auctions to LPs!