What's Driving Token Prices? June 28, 2023

Katie Talati
Jun 28, 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.

Watch Our Founders Video

  • AUDIO (-6.9%) - Decentralized music streaming platform Audius is under pressure this week following troubles at crypto custodian, Prime Trust. Approximately, 88% of the digital assets owned by Prime Trust are said to be $AUDIO tokens. Prime Trust claims it lost access to the keys of certain wallets and therefore was unable to access its crypto assets. It is unknown what will happen with the remaining $AUDIO tokens with many trying to short the token and others claiming it could be accessed by creditors. 

  • TUSD (-0.7%) - Traders in the market have been shorting stablecoin TrueUSD in anticipation of issues with its reserves which are custodied at Prime Trust. TUSD, which has a $3b market cap, is a stablecoin priding itself on safety and security and claiming it is “the first USD stablecoin operated by a regulated operator”. Although the story is still unfolding, Prime Trust is being accused of using customer assets to buy back crypto that it is unable to access. Currently, the custodian owes over $85m in fiat currency but only has $2.9m, and owes $69.5m in digital assets to its clients but only has $68.65m.

  • ARB (-0.2%) - Yesterday, native cross-chain bridging for USDC went live on layer-2 protocol Arbitrum. The introduction of Circle’s Cross-Chain Interoperability Protocol (CCIP) allows for direct bridging to and from the Ethereum and Avalanche networks. This is a huge change from current bridges which use mint/redeem features when bridging assets. CCIP greatly reduces the security and exploitation risks of traditional bridges and should hopefully bring greater liquidity and composability between chains. However, this type of protocol only works since Circle is a centralized entity controlling the flows of USDC among different chains.

  • FTT (+54%) - FTX’s exchange token soared last week based on a new lawsuit launched by the now-bankrupt firm. The lawsuit was brought by the FTX creditor’s committee against K5 Global, an investment group that accepted $700m from FTX’s ex-CEO, Sam Bankman-Fried. When he made the investment, Bankman-Fried claimed the money was his, however, following last year’s collapse of FTX, it became clear that these assets were owned by the exchange and therefore belong to creditors. As part of the $700m investment, the founders of K5 Global supposedly each received $125m for their services and included introductions to celebrities, sports stars, and politicians. The lawsuit will likely take a long time to play out, but the market is hopeful that it will be successful with FTT trading up 54% this week on the news

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

Subscribe For the Latest Blockchain News & Analysis



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.

You May Also Like

These Stories on Investing Themes