What's Driving Token Prices? February 1, 2023

Katie Talati
Feb 1, 2023

Join Katie Talati, Arca’s Head of Research, weekly on Wednesday at 4PM EST / 1PM PST as she shares notable token activity over the past week and her insights on what market events drove these token price movements.

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  • FLOW (-5.7%) - Last week, NFT project Doodles announced it would move from Ethereum to gaming-focused Layer 1 blockchain Flow. Flow, backed by Dapper Labs, is best known for its NBA Top Shot NFT project, which gained wild popularity in 2020. The Doodles project is also releasing its newest NFT project, Doodles 2, on Flow. This is the most high-profile project to migrate to Flow’s blockchain and might spell a turnaround for the Layer 1, which has relatively little going on.

  • SOL (-2.4%) - Last week, Layer 1 protocol Solana announced the release of its dApp store for its new Saga phone, which has slowly started to ship to customers in the past few weeks. The decentralized app store comes pre-downloaded on every phone; however, there are no available apps to download. Despite this, the Saga phone offers a model for how digital assets could become mainstream.

  • MPL (+2.9%) - Maple, the uncollateralized lend/borrow protocol that suffered several problems last year concerning borrower defaults following Luna’s and FTX’s collapses, plotted a comeback and a pivot last week. The project announced it would move away from uncollateralized lending and instead launch a new liquidity pool that would focus on bringing real-world assets on-chain. This will launch with a new liquidity pool with $100M of trade receivables, essentially allowing firms to borrow cash before receiving their tax rebates. 

  • DYDX (+60%) - In case you missed it, Arca’s CIO released a tweet thread last week challenging the dYdX team’s token and use case. dYdX is a decentralized derivative project that, despite having 70%+ market share, has a token with very little functionality. Following the release of this tweet thread, the dYdX team announced that it would push back the February unlock of investor tokens that was due to inflate the supply by almost 100%.

DISCLAIMER: This commentary is not intended to be investment advice, investment research, or a recommendation. Please consult your investment professional for your own circumstances."


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Disclaimer: This commentary is provided as general information only and is in no way intended as investment advice, investment research, legal advice, tax advice, a research report, or a recommendation. Any decision to invest or take any other action with respect to any investments discussed in this commentary may involve risks not discussed, and therefore, such decisions should not be based solely on the information contained in this document. Please consult your own financial/legal/tax professional.

Statements in this communication may include forward-looking information and/or may be based on various assumptions. The forward-looking statements and other views or opinions expressed are those of the author, and are made as of the date of this publication. Actual future results or occurrences may differ significantly from those anticipated and there is no guarantee that any particular outcome will come to pass. The statements made herein are subject to change at any time. Arca disclaims any obligation to update or revise any statements or views expressed herein. Past performance is not a guarantee of future results and there can be no assurance that any future results will be realized. Some or all of the information provided herein may be or be based on statements of opinion. In addition, certain information provided herein may be based on third-party sources, which is believed to be accurate, but has not been independently verified. Arca and/or certain of its affiliates and/or clients may now, or in the future, hold a financial interest in investments that are the same as or substantially similar to the investments discussed in this commentary. No claims are made as to the profitability of such financial interests, now, in the past or in the future and Arca and/or its clients may sell such financial interests at any time. The information provided herein is not intended to be, nor should it be construed as an offer to sell or a solicitation of any offer to buy any securities, or a solicitation to provide investment advisory services.

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