What's Driving Token Prices? January 4, 2023

Katie Talati
Jan 4, 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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  • SUSHI (+0.75%) - Decentralized exchange Sushiswap announced plans to dissolve its lending protocol Kashi and its token launchpad, Miso. In addition, the team released an initial tokenomics proposal which includes using SUSHI incentives to attract long-term capital. The proposal consists of a mix of incentives for liquidity providers, protocol earnings for xSUSHI stakers who agree to timelocks, and a buyback and burn mechanism.

  • SOL (+31%) - Solana has been on a roller coaster the last week after tumbling 95% in 2022 following overall market contraction and the implosion of FTX. Recently, Solana has been plagued with more trouble as prominent NFT projects y00ts and DeGods announced they would move from Solana to Polygon and Ethereum, respectively. Both projects account for over 50% of the NFT volume on Solana; the move could be a blow to Solana’s burgeoning NFT ecosystem. Despite the decline, Solana bounced back about 30% in the last week after Ethereum founder Vitalik Buterin tweeted that “the chain has a bright future” and he hopes “the community gets its fair chance to thrive.” Finally, Solana saw a spike in interest following an airdrop for $BONK token which is a meme token inspired by DOGE/SHIB.

  • BIT (+40%) - BitDAO, the DAO that governs BIT (the token for centralized exchange ByBit), passed a proposal for the BIT purchase program last week. The proposal approved a daily $2M purchase of BIT tokens for the next 50 days for a total of $100M. Since the proposal was introduced (before Christmas), the token has increased 35%. 

  • LDO (+43%) - Liquid staking derivative platform Lido has seen a meteoric rise in its token price over the past few days as the liquid staking derivative space has taken off in anticipation of the upcoming Ethereum upgrade that will enable staked ETH withdrawals. When withdrawals are enabled, platforms like Lido can realize and sell accrued staking rewards, which will increase their earnings. In the case of Lido, they hold $5.6M in stETH earnings.


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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