What's Driving Token Prices? June 26, 2024

Katie Talati
Jun 26, 2024

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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  • ETHFI (-6.9%)—Liquid staking protocol ether.fi voted last week to institute a token buyback using 5% of the protocol’s revenue. The initial vote went through, and an overwhelming 99% of voters said yes. The governance discussion suggested starting the buyback using only 5% of revenue, but it could be increased by up to 50% over time. The repurchased tokens will provide liquidity for ETHFI on DEXs and other venues. 
  • CHZ (-3.9%) - Sports blockchain Chiliz Chain announced it had reached 1 billion CHZ tokens staked yesterday, marking just over 11% of the supply locked in staking. The increase in CHZ staked is likely in response to the tokenomics upgrade made to the protocol a few weeks ago, which added new inflationary rewards to the supply schedule that can be paid out to validators who stake on the network. The European Cup is also putting Chiliz in the spotlight as it has initiated its burn campaign, which will burn the fan tokens for teams based on the number of goals scored by a team scores during the tournament. So far, tokens for Portugal ($POR) and Italy ($ITA) have been burned..
  • SOL (+0.1%) - Layer-1 protocol Solana had a news-filled week beginning last Thursday when the first Canadian SOL ETF proposal emerged. Then, on Friday, Helius Labs announced a ZK compression system for Solana, which can potentially compress transactions by 10,000x. This would massively increase the scaling potential for Solana, which has recently faced congestion and higher fees. Finally, yesterday, Solana introduced “Blinks” and “Actions,” which allow users to trade crypto directly through social apps. Blinks are blockchain links that turn an on-chain action into a shareable link, creating an easier way for users to interact with the blockchain. Actions are APIs that can return Solana transaction information, simplifying the signing and sending process. 

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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