What's Driving Token Prices? May 31, 2023

Katie Talati
May 31, 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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  • MULTI/FTM (-41%/-9.4%) - Last week, bridging project Multichain saw a 40% decline after rumors surfaced that the founding team had been arrested in China. The problems began last week when users started to complain about transaction delays, which the team blamed on a recent upgrade. On-chain detectives were quick to point out that several large entities withdrew their assets from Multichain, including the Fantom Foundation, which withdrew about $2.4M in liquidity. Fantom's token also saw price declines as Multichain is the only bridge to the Fantom blockchain.

  • OP (-9.4%) - Layer-2 protocol Optimism will unlock a large number of its tokens this week. The unlock comprises core contributors and early investors, and the newly released tokens will double the circulating supply. The unlock comes a week before Optimism’s Bedrock upgrade, which is projected to lower fees on the L2.

  • JOE (+19%) - Decentralized exchange Trader Joe is outperforming this week following a number of positive fundamental changes on its exchange—primarily a massive increase in its DAU/MAUs. Active monthly users have increased about 5x since April from ~50K to roughly 250K. The increased activity has been attributed to the bridge between Bitcoin and Avalanche, which is supported by the Stargate cross-chain bridge on Layer Zero. Many speculate that Stargate will soon airdrop a token to the bridge’s users, which has encouraged the increase in activity. Avalanche has also seen an uptick in activity, boasting an all-time high in monthly active users of almost 900K.

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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