Memecoin frenzy powers Tron DeFi

October 18, 2024

Reading time: 5 minutes

High-risk loans in DeFi surge, raising concerns over liquidation cascades

Key points:

  • High-risk crypto loans have reached a two-year high.

  • Liquidation cascades can destabilize the market.

News - The decentralized lending market is experiencing a significant uptick in high-risk loans, raising concerns about potential liquidation cascades and increased market volatility.

According to data from IntoTheBlock, the total value of loans within 5% of their liquidation price reached a two-year high on Wednesday, reaching $55 million.

What’s the risk factor? Decentralized lending platforms allow users to borrow funds by locking up digital assets as collateral. If the value of the collateral falls below the loan amount, the platform can liquidate the debt, selling off the collateral.

The recent surge in high-risk loans indicates that a growing number of borrowers are operating on the brink of liquidation.

This situation poses a significant risk to market stability. A series of liquidations can trigger a downward price spiral, as the selling of collateral can further depress asset prices, leading to more liquidations.

In conclusion - As lenders become more cautious about potential losses, they may be less willing to provide new liquidity, exacerbating the situation.

26 Million U.S. voters demand strong crypto policies ahead of elections

Key points:

  • About 26 million U.S. voters prioritize pro-crypto policies when voting in November.

  • 16% of respondents consider crypto issues highly significant in their decisions.

News - A recent survey indicates that approximately 26 million voters in the United States identify as part of a "crypto voting bloc," making pro-crypto policies a crucial factor in their electoral decisions for the upcoming November elections.

According to The Digital Chamber, which released the findings on October 17, about 16% of the 1,004 participants rated cryptocurrency issues as "extremely" or "very" significant in their voting choices.

What’s more? Notably, 25% of Democrats and 21% of Republicans indicated that a candidate's crypto stance could positively influence their votes.

Perianne Boring, the founder and CEO of The Digital Chamber, emphasized that these results should alert policymakers, especially with a close race anticipated for the presidency. She noted that this bipartisan bloc has the potential to sway electoral outcomes.

Additionally, the survey revealed that 40% of Black voters consider a candidate's crypto policies as vital to their voting decision, significantly higher than white voters.

Sam Altman's Worldcoin introduces Ethereum Layer 2 blockchain, World Chain

Key points:

  • Worldcoin has launched its Ethereum layer 2 blockchain called World Chain.

  • The platform is accessible to 15 million users who have completed iris scans for World IDs.

News - Sam Altman's crypto-based digital identity project, Worldcoin, has taken a significant step forward with the launch of its new Ethereum layer 2 blockchain, World Chain.

Designed to prioritize verified human users, the blockchain offers a range of benefits, including access to block space and free gas.

What are the advantages? World Chain boasts a robust ecosystem of top-tier applications and projects, such as Optimism for interoperability, Uniswap for asset swaps, and Zerion for real-time APIs. This integration aims to enhance the user experience and drive wider adoption of the Worldcoin token.

To support its human-centric approach, Worldcoin has also introduced a new and improved Orb device. This biometric device, powered by Nvidia hardware, is more efficient, smaller, and offers enhanced identity verification capabilities.

While the WLD token's price experienced a slight dip following the announcement, the long-term implications of this development remain to be seen.

Memecoin frenzy on SunPump fuels 487% surge in Tron’s DeFi transactions

Key points:

  • Tron's memecoin launchpad, SunPump, fueled a surge in blockchain activity and revenue.

  • Over 89,000 tokens were launched on SunPump during the third quarter.

News - Tron's blockchain experienced a surge in activity and revenue during the third quarter, primarily driven by the popularity of its memecoin launchpad, SunPump. Over 89,000 new tokens were launched on the platform, sparking a frenzy among investors.

This memecoin craze had a significant impact on Tron's decentralized finance ecosystem. Transactions increased by nearly 487%, and the burning of TRX tokens surged, contributing to a 24% increase in the token's circulating supply.

More details - The SunPump phenomenon also boosted other metrics for Tron's blockchain. The average daily transaction count and active addresses rose, indicating growing interest and engagement.

Despite a recent decline, Tron's total value locked in decentralized finance protocols remains substantial. Additionally, the stablecoin USDT continues to dominate on the Tron network, accounting for nearly half of its total market capitalization.

Interesting facts

  • Initially, Bitcoin and Gold had their prices moved independently, but after the market crash in 2020, triggered by the COVID-19 crisis, their correlation stands at an impressive 0.87, signaling a strong positive relationship.

  • According to CoinMarketCap, over the past decade, the cryptocurrency market has seen explosive growth, with the number of cryptocurrencies soaring to over 23,000 from just seven in 2013.

  • Mt. Gox, a Tokyo-based Bitcoin exchange, controlling over 70% of global transactions by early 2014, abruptly shut down. It was hacked and thousands of Bitcoins were stolen; the company filed for bankruptcy shortly thereafter.

Top 3 coins of the day

Aptos (APT)

Key points:

  • APT’s value increased by 24% over the last seven days.

  • At press time, it was trading at $9.99.

What you should know - Aptos has been on a steady upward trend, forming higher highs and higher lows within a rising channel since mid-September. The price recently approached the upper boundary of the channel, suggesting some resistance around the $10.50 mark. A rejection at this level may prompt a short-term retracement toward the lower boundary, around $8.00, which aligns with previous support. The Awesome Oscillator remains positive, indicating that bullish momentum is still intact, although it shows signs of weakening. Volume has been consistent, supporting the upward movement, but a further increase is needed to confirm a breakout above the upper channel. Traders should watch for a breakout above $10.50 for a potential continuation to higher levels.

Uniswap (UNI)

Key points:

  • UNI was registering significant losses at press time.

  • This, when most of its competitors were in profit.

What you should know - Uniswap remains rangebound between $7.00 and $8.00, as indicated by the highlighted range in the chart. The price has tested both the upper and lower boundaries multiple times without a significant breakout, suggesting indecision in the market. The RSI is currently at 52.25, reflecting neutral momentum, with no strong signals of overbought or oversold conditions. Volume remains relatively low, indicating that there isn’t much conviction behind recent price movements. To break out of this range, a surge in volume would be required. A breakout above $8.00 could see UNI testing higher resistance levels around $9.00, while a drop below $7.00 could lead to a retest of the $6.00 support.

Injective (INJ)

Key points:

  • At press time, INJ was trading at $22.06.

  • It was up by 13.80% over the last seven days.

What you should know - Injective has seen a significant upward move, rallying over 61% from its recent lows around $15 to its current levels near $22.15. The price broke through resistance at $20, signaling a shift in market sentiment. The next major resistance lies at $24, where the recent high was established. A successful close above this level could see INJ targeting $26 and beyond. The MACD shows increasing bullish momentum, with the MACD line crossing above the signal line. Additionally, the volume spike supports the recent price action, indicating strong buying interest. If INJ faces rejection near the $24 resistance, it could retrace to the $20 support level, which aligns with the recent breakout point.

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