The tokens have recorded massive gains over the past couple of days – despite the situation with Bitcoin and Ethereum and its low price range.
While Bitcoin remained relatively stable in the $6,700 region, Ethereum, Stellar, EOS, Ripple and Bitcoin Cash all recorded losses that ranged from 0.5% to 1.5%.
What was unexpected, however, was the tokens including ICON, Ontology, Nano, WaltonChain, Aion and WanChain surged against the Bitcoin and USD. While Nano, Dent, and ICON recorded 33.5%, 33% and 20% gains against Bitcoin – they were also the best performing altcoins on August 26th.
If we see historically, the conclusion is simple – tokens always followed the price trend of the large-cap altcoins such as Ethereum, Ripple and EOS – with movements either on the upside or on the downside.
The surge of ICON, however, can be attributed to the team’s plan to buy back $5 million worth of ICX in the short-term, which the team disclosed as one of the several initiatives of 2018. As the team said in June:
“Theloop has been recognized for bringing a practical use-case for blockchain technology in the insurance industry through the Smart Insurance Claims service. Theloop will accelerate its efforts to build a next-generation insurance platform with Kyobo Life. This MOU will lead to collaboration on more projects to increase efficiencies in the insurance industry, a mutual effort to expand this technology to ASEAN, and blockchain advisory and support initiatives.”
Meanwhile, WenChain also released its 2.0 client this July, which is how the surge reflected its price at the time. As a fork of Ethereum and a platform for decentralized applications (dApps), the hype around this token has risen since the release of the 2.0 version.
Even though it is unlikely for tokens to continue this surge in the short-run (because of the volume of the crypto market), this is still a positive movement that brought new gains to many investors and altcoin backers.
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“The first one is that it can support multiple collateral types. This, of course, means ERC-20 tokens. It also means Bitcoin through WBTC. A range of cross-chain assets that are emerging now. Also, there will be other stablecoins. Centralized stablecoins that already exist on the Ethereum blockchain. But most importantly, security tokens.”The MakerDAO foundation initially owned all of its MKR tokens but as Rune explained, they sold them off to multiple huge players in the EthereMum world in order to fund teams of 100 people. He says that MKR exists only to be able to vote in the system. The system rewards people who hold CDPs and when everything goes well, the MKR total supply is reduced, tokens get burned off and the value of the remaining tokens increases. Dai is extremely unique and some consider it as the real stablecoins, unlike the pegged coins. Dai is built on an open system so people who invest in cryptocurrency can access the stability of the Oracle system. Christensen also explained how real security tokens operate better in the world of traditional assets. He said:
“Security tokens are still something that is quite new. But what that really represents to Maker is the ability to now interact with real-world assets. The ability to interact with real-world finance and provide arbitrage opportunities between the traditional finance world and the tokenized world. That means that in the future the Dai will not just be backed by volatile cryptocurrencies, but things like real estate, bonds, and stocks.”The most important way to use Dai is as a stablecoin. If anything happens to the Ethereum network, there could be some negative consequences to the market but MakerDAO couldn’t get in a worse position than the one last year.
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