What's Driving Token Prices? March 13, 2024

Katie Talati
Mar 13, 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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  • UNIBOT (-46%) - Telegram trading bot interface, Unibot, announced on Monday that it would be separating from the team that built its very popular Solana trading bot product. Unibot, which initially launched its product on the Ethereum mainnet, recently expanded its product suite to Solana, increasing its popularity since Solana has become a large venue for the on-chain trading memecoins. The Unibot core team stated that those who built and maintained the Solana version of Unibot do not “represent us and our core values for transparency, security, and honesty.” The Solana Unibot team has rebutted these claims and accused the core team of incompetence and negligence.  Since most of Unibot’s recent volume is from Solana, many in the community have sided with the Solana team, believing Unibot will be unable to compete in the crowded Ethereum market.
  • ETH (+2.9%) - Early this morning, Ethereum underwent its latest hard fork upgrade, Dencun. The most important part of the upgrade is EIP-4844 or “protodanksharding” which will lower the cost for Layer-2 blockchains to post transaction data to Ethereum. This feature is very important for Layer-2s, such as Optimism, as the lowered costs could spur additional activity on these chains.  
  • MKR (+38%) - Over the weekend, decentralized stablecoin issuer, MakerDao, voted through a number of emergency rate changes to help as assets when its Peg Stability Module (PSM) was drained. As the demand for stablecoins/cash increased with recent market volatility, the borrow rates on Spark (MakerDao’s lending platform) did not increase in line with the market, allowing users to borrow from Spark cheaply. As a response, Maker increased the Dai Savings Rate (DSR) from 5% to 15% and increased borrow rates for new loans from ~6% to over 15%. Yesterday, a Maker’s governance forum post announced that Phase 1 of “Endgame”, a 5-phase roadmap for a major update to MakerDAO designed to enhance efficiency, resilience, and participation, will begin this summer.
  • TON (+64%) - Early this week, messaging app Telegram, announced it had 900M MAUs and was potentially eying an IPO sometime later this year. According to CEO Pavel Durov, since introducing premium subscriptions and advertisements, the company has generated “hundreds of millions of dollars” in revenue. Although Toncoin is not directly related to the Telegram app’s success, some speculate that as new games and apps launch through Telegram, they will instantly have a massive distribution pipeline, unlike other L1 blockchains. This news follows an announcement two weeks ago that Telegram would share 50% of its ad revenue with token holders via distributing more TON tokens. TON is up 64% this week and up 73% since this initial announcement.

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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