Top Ten Crypto Market Capitalizations Shifted a Great Deal Since the Last Time BTC Hit $60K

Top Ten Crypto Market Capitalizations Shifted a Great Deal Since the Last Time BTC Hit $60KThe price of bitcoin recently jumped above the $60,000 per unit mark on October 15, and the leading crypto asset has not seen prices this high since mid-April six months ago. However, as far as the top digital assets are concerned, in terms of market capitalization, things are a whole lot different. For instance, ether […]
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Uniswap moves closer to a new five million UNI airdrop

The Uniswap community is voting on its second-ever governance proposal to distribute 5 million governance tokens to users who interacted with the DEX via a third-party platform.

The second-ever governance proposal for the Uniswap decentralized exchange (DEX) is more than halfway to reaching a quorum with a little over 30 hours to go.

If passed, the proposal will see 12,619 wallet addresses that interacted with Uniswap via a proxy contract receive 400 UNI tokens each. 5.05 million UNI in total will be allocated to the users of MyEtherWallet, Argent, Dharma, DeFi Saver, Nuo, Eidoo, Opyn, Furucombo, Monolith, and Rebalance.

The proposal was put forward by Compound-based lending and savings protocol Dharma, who claimed its users felt “left out” by the initial distribution.

The cohort of proxies were chosen due to them being “less programmatically accessible,” suggesting “a lower likelihood of multiple addresses per end-user.”

“The Phase determination was made based on how easy it is to programmatically hook a trading bot into them, as this is a proxy for what portion of these cohorts risk representing multiple addresses per end-user.”

The voting deadline is roughly 8:00 am UTC on October 31.

Should the vote pass, Dharma plans to put forward a secondary proposal for retroactive distribution. “Should both Phases pass, we will not vote in favor of any further retroactive airdrops,” Dharma noted.

The vote appears to be steadily gaining support, with the number of votes in favor increasing roughly 25% in the past couple of hours to 25.93 million, compared with 1.26 million votes against. A quorum of 40 million votes in favor must be submitted to pass the proposal.

However, Uniswap’s first governance vote, also put forward by Dharma, recently failed due to falling short of a quorum by the deadline by just 1% despite 98% of votes cast supporting the proposal.

Although the number of opposing votes was low, several analysts suggested that a large segment of the community may have opposed the proposal by abstaining from the vote.

The second proposal has also received pushback, with SpankChain CEO Ameen Soleimani criticizing the retroactive distribution for failing to “create any wealth for UNI holders” while removing funds from the project’s treasury that could be allocated elsewhere, and giving the tokens “to folks who will likely sell it, probably having a small negative price impact.”

Despite his qualms, Soleimani conceded he would vote in favor of the proposal should it be “the absolute last fund recovery ever,” warning that Uniswap must “avoid these kinds of governance quagmires” moving forward.

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DeFi plummets: 3 reasons for the 46% correction from YFI, UNI, DEX tokens

Ethereum’s correction triggered a DeFi-token collapse which resulted in YFI and UNI dropping by 46%.

After outperforming Bitcoin (BTC) and Ether (ETH) strongly in August, Decentralized Finance (DeFi) tokens are now plummeting as many registered losses of up to 50%. 

Cryptocurrency daily market performance snapshot

Cryptocurrency daily market performance snapshot. Source: Coin360

At the moment, the two coins garnering the most attention are Yearn.finance (YFI) and Uniswap (UNI) as both have dropped by 46% and 48% since reaching a monthly peak.

YFI/USDT 4-hour chart

YFI/USDT 4-hour chart. Source: TradingView.com

Three catalysts appear to be behind the correction: Ether’s pullback, profit taking from BTC’s previous rally and a strong sell off amongst DeFi-tokens.

Most DeFi tokens corrected by 15% to 25%

The overwhelming majority of DeFi tokens have dropped by 15% to 25% on the day. Even cryptocurrencies that are not directly considered to be DeFi tokens, like Chainlink (LINK), saw a 15% price drop.

While the pullback of DeFi tokens coincides with the decline in Ether price, a take-profit correction was expected by many analysts.

As an example, Yearn.finance has evolved into a dominant player in the DeFi market in less than three months. In the process, the price of YFI rose by 1,200% on Binance to a peak at $43,966.

Uniswap’s native governance token UNI saw a similarly explosive upsurge in a significantly shorter period.

As Cointelegraph reported, Uniswap airdropped 400 UNI tokens to every user that used the Uniswap decentralized exchange before Sept. 1. At its peak at around $8.80, the 400 UNI tokens were worth $3,520.

UNI saw a massive price spike in a short period because of multiple major exchange listings. Within the first five hours of launching, Coinbase Pro, Binance, and FTX listed UNI. As a result, the price of the token surged from $0.30 to $8.80 in less than five days.

UNI/USDT 4-hour chart

UNI/USDT 4-hour chart. Source: TradingView.com

Due to the massive gains of DeFi tokens in their USDT and BTC pairs, a profit taking correction was widely anticipated but the intensity of this correction has many traders surprised.

Ether struggles to sustain momentum

Historically, Ether has led the rallies among altcoins, including DeFi tokens. In some bull cycles, Ether also front ran BTC price. For example, from March to August, as Bitcoin price recovered from the infamous Black Thursday crash, Ether price strongly outperformed BTC.

However, Since Sept. 1, Ether has struggled to match the performance of Bitcoin. While BTC rallied from $10,300 to $11,100, Ether remained pinned below $400.

In the past 20 days, Ether price declined by around 28% and in the same period, BTC recorded a 12% drop against the U.S. dollar.

Ether’s short term weakness was likely caused by the increased selling pressure on DeFi tokens, hence the nearly 50% correction from the likes of UNI and YFI over the past few days.

Bitcoin profit taking kickstarted the DeFi correction

The sentiment around BTC’s rally from Sept. 9 to Sept. 19 remains mixed. Interestingly, BTC alone saw a strong upsurge, while Ether, altcoins and the majority of DeFi tokens remained stagnant. This is somewhat atypical as usually when Bitcoin is range bound, altcoins rally, and when Bitcoin rallies moderately altcoins may lag but still tend to follow BTC’s bullish price action. 

This short term inverse correlation between BTC and altcoins suggests that BTC saw a take-profit rally as investors cycled profits from DeFi tokens to BTC.

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Pinned below $11K, Bitcoin price plays second fiddle to Uniswap (UNI)

Bitcoin price still faces resistance at $11K as traders turn their attention to DeFi-tokens like Uniswap (UNI).

As the weekend begins, Bitcoin (BTC) price continues to fluctuate between the $10,800-$11,000 range. 

Cryptocurrency daily market performance snapshot

Cryptocurrency daily market performance snapshot. Source: Coin360

Some analysts would say the digital asset has lost momentum but a quick glance at the 1-hour or 4-hour chart shows Bitcoin chugging along sideways in a defined range which is starting to see some compression. 

BTC/USDT 1-hr chart

BTC/USDT 1-hr chart. Source: TradingView

Despite what appears to be ‘disinterest’ from crypto traders, Bitcoin price is painting higher lows and lower highs and if this pattern continues a breakout should be expected before the weekly close. Of course predicting the direction of this breakout is the hard part. 

If the breakout were to the upside, the overhead resistance at $11,150 and $11,600 will make any attempts at $12,000 difficult. 

In the event that the price breaks downward, traders would expect support at $10,550 but the gap from $10,826 to $10,480 on the volume profile visible range suggests that $10,490-$10,400 is where the price would park.

Hence, at the moment the risk-to-reward odds for the average trader are not very enticing, especially when compared to the juicy price action seen from the likes of UniSwap’s UNI token which rallied another 124% on Friday. 

UNI/USD daily price action

UNI/USD daily price action. Source: CoinMarketCap

In fact, data from DeFi Pulse shows the total value locked in UniSwap DEX reached $1.75 billion as traders stampeded back to the platform to acquire various DeFi-related tokens or earn high interest from yield farming. 

Total USD value locked in Uniswap

Total USD value locked in Uniswap. Source: DeFi Pulse

Over the past 24-hours the platform has seen an 80% increase in inflow and it’s possible that the intense focus of traders chasing DeFi profits is reducing demand for Bitcoin as centralized exchanges have registered a drop in spot volumes. 

Bitcoin spot aggregated daily volumes

Bitcoin spot aggregated daily volumes. Source: Skew.com

Given that demand for DeFi-related tokens is likely to increase, traders might keep an eye on the price of Ether as the altcoin has already gained 10% since the start of the week and could rally to $422 if bulls can push the price through the high volume VPVR node at $392. 

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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More pump than dump: 22% UniSwap (UNI) price drop doesn’t faze traders

UniSwap’s UNI governance token soared to $8.60 before correcting sharply but top traders expect the price to rise higher.

Earlier today Yearn.finance (YFI) and Ether (ETH) rose sharply after Uniswap’s governance token UNI plunged 22% from $8.00 to $6.80.

Cryptocurrency daily market performance snapshot

Cryptocurrency daily market performance snapshot. Source: Coin360

UNI, which launched less than 48 hours ago, has rallied from around $1.00 to $8.00 in a short period. After an impressive eight-fold gain, the token started to pull back but trading volume suggests traders have their eyes set on higher prices.

YFI and ETH rallied as UNI corrected 

As UNI started to make a parabolic rally from $1 onwards, the funding rate of the cryptocurrency across major exchanges turned negative.

Traders, the majority of which were at FTX exchange, were heavily shorting UNI in anticipation of a strong pullback. These traders might have thought that most holders of the 400 UNI tokens UniSwap airdropped to its users would want to cash in after their value reached $2,640.

The exact opposite occurred as within 5 hours of launching, Binance, Coinbase Pro, and FTX all listed UNI. This marked the fastest listing among the top three exchanges for a newly-launched token and has led some crypto pundits to question whether exchanges are violating their own listing policies in pursuit of quick profits.

The swift listing by these exchanges caused the demand for UNI to soar and the negative funding rate on FTX further fueled the rally as short contract holders were pushed out of their positions. 

Eventually, the token topped out at around $8.60 on Binance and was followed by a 22% correction where the price consolidated in the $6.50 range before moving back to $7.00. As this occurred, the price of YFI surged by 10.72% from $31,158 to $34,509. 

The inverse correlation between YFI and UNI

The inverse correlation between YFI and UNI. Source: Hsaka, TradingView.com

Ether also rose slightly by more than 1% immediately after the price of UNI declined.

Hsaka, a popular crypto-analyst on Twitter pointed out what he calls an inverse correlation between UNI and major DeFi tokens like YFI. According to him, this shows that many DeFi users were trading UNI but as soon as UNI topped out, the profits cycled back into top DeFi tokens, with YFI being the primary beneficiary.

Top traders views on the UNI rally and sharp correction

While the sudden upsurge of UNI surprised many investors, some traders expected the governance token to rally.

A pseudonymous analyst known as “DC Investor” said that as the most used app on Ethereum, UNI’s strong performance was not a surprise. He said:

“Can’t comment much on near-term price. But I guess I’m just surprised that people are surprised by UNI raging. Most used app, fees greater than Bitcoin, does volume bigger than many CEXes, and one of the best demos of Ethereum. Learn to see & buy the real ones.”

Another popular crypto-Twitter trader known as “Crypto Medici” said UNI is still likely undervalued and over the long term, he expects a $3 to $5 billion valuation. The trader noted:

“UNI going to be worth $3-5 billion (conservative) Still extremely undervalued. Token distribution was genius and many that sold will FOMO back in when we break $1 billion. This is before V3 comes out, and liquidity mining ramps up.”

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