Jul 21, 2023 04:45
The crypto market swiftly turned bearish from yesterday’s scarcely bullish outlook, and top coins have receded farther from their new-found support. But interestingly, MarkerDao’s MKR appears unperturbed by the market’s gloomy sentiment as MKR soared higher with massive gains, adding over 17% to its value on the day. MKR Price Outlook Over the last day, the MRK token has witnessed several steep rise and fall. The digital asset reached a day-high of $1,203 at 2:30 am UTC on July 21, a 20% increase from its July 20 opening price. Related Reading: Best Bitcoin Roulette Sites And Crypto Roulette Games MKR had lost momentum shortly after the $1,203 peak spike, falling to $1,134. However, it continued the fluctuations before regaining momentum for a more bullish rise. At the time of writing, Maker’s price is changing hands at $1,162, with a 17.63% 24-hour price increase. Maker’s current price is 26% higher than its value seven days ago and it may surpass $1,200 if it sustains the current bullish rally. A close look at MKR’s sudden price resurgence suggests the token might be riding on some other bullish waves. Possible Reasons Behind Maker’s Sudden Price Surge Maker’s dramatic price surge may be due to recent developments in the MakerDAO ecosystem. On-chain sleuth, Lookonchain, reported some conspicuous activities by top VC firms Andreessen Horowitz’s a16z and CMS Holdings, which are suspected to be responsible for the price surge. According to the report, a16z recently deposited large chunks of Maker tokens to Coinbase. The venture capital company deposited 12,864 MKR tokens worth approximately $12.6 million at the time. The firm also reportedly transferred another 6,900 MKR, worth $8 million by today’s exchange rates, to a new address, presumably with plans to deposit the funds on an exchange. Currently, a16z holds around 12,396 MKR tokens worth ~$14.4 million. Also, Lookonchain reported that CMS, a blockchain-focused private investment company, reduced its recently acquired MKR holdings. CMS Holdings deposited 525 MKR tokens worth $614,000 to Binance two hours before the sharp price surge. CMS previously withdrew 1,325 Maker tokens worth $1.54 million from Binance and Bitget at an average price of $793. The investment firm now holds 800 MKR, worth approximately $936,000. Implications Of a16z And CMS Holding’s Activities The unprecedented change in the token holdings of these top market players must have significantly contributed to the token’s price spike. The market positively reacted to the massive MKR sales, leading to increased trading volume and price surge. The sharp spike in MKR’s price can be interpreted this way: the trading activity of institutional investors like a16z and CMS Holdings draws more attention to Maker. The renewed interest could bring new buyers, exerting more demand pressure on the token and causing the price to spike further. Related Reading: Dogecoin Sees Positive Price Movement, Bulls Set Crosshair At $0.075 However, the firms’ Maker holdings reduction may raise questions about the token’s long-term value. This potentially bodes badly for MKR as it could depress investor sentiment, causing massive selloffs which might push the price down. Featured image from Pixabay and chart from TradingView.com
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