Uniswap’s rally of an amazing 600% could start another Defi boom as the decentralized exchange shocked the world when it releases the UNI token earlier this month as we reported in the crypto news.
The coin was released retroactively to the historical users of the platform but even still, the governance token surged shortly after the launch, shaking of the strong selling pressure from those that dumped their fee allocations. From the lows put in an hour after the launch, the Ethereum-based UNI surged to 600 percent, reaching a price point of $7 as of the time of writing.
The coin reached a level where the market capitalization is getting close to the $1 billion levels despite the 15% of the coin’s supply getting emitted. Maple Leaf Capital, the crypto consultant and financier that was mostly focused on Defi over the past few months, commented that the speedy growth of the UNI market capitalization to $1 billion circulating and Uniswap’s rally beyond 600% will result in another wave of DeFi rally.
10th reaction and it’s a real alpha leak. As UNI gets to 1-1.5 Bn circulating and hopefully market doesn’t shit the bed, all these defi coins will look cheap again and the ceiling is now opened up + funds take some profit go rotate back. https://t.co/gls6DARG0c
— Maple Leaf Capital (@MapleLeafCap) September 18, 2020
“10th reaction and it’s a real alpha leak. As UNI gets to 1-1.5 Bn circulating and hopefully market doesn’t shit the bed, all these defi coins will look cheap again and the ceiling is now opened up + funds take some profit go rotate back.”
When UNI printed a blow-off top above the $8.50 level falling to the $6 price level in a few minutes, Yearn Finance surged immediately by eight percent. Other Defi tokens as well as BTC and ETH saw strong jumps as the capital from UNI got cycled back into the crypto markets. Qiao Wang, the former head of product at Messari shared a different take on the rally. He believes that the rally of the token will mark a “relief rally” for the Defi space after it dropped by 30-50 percent in September:
‘It all started with COMP. SUSHI was the blow-off top. UNI was the relief rally. Mini-winter is nice though as we can focus on building again. Next year will be a good year. Micro lots of new exciting products and macro risk-on everywhere.”
The sentiment is in line with what Theta Seek said a few days ago. They said that there are a few reasons why the growth in the ETH DeFi space is likely reaching a top for the time being, including reasons such as user experience being mediocre because of the fear of losing funds and the high transaction fees. Some other reasons include the value of capital entering the space which slowed down meaning that DeFi is absorbing value from other cryptocurrencies as exposed to external inflows and that the regulators were taking notice of DeFi which could pose a threat to companies and innovators in the space.
DC Forecasts is a leader in many crypto news categories, striving for the highest journalistic standards and abiding by a strict set of editorial policies. If you are interested to offer your expertise or contribute to our news website, feel free to contact us at [email protected]