What's Driving Token Prices? October 23, 2024

Katie Talati
Oct 23, 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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  • SCR (-23%) - Yesterday, Layer-2 rollup Scroll launched its token $SCR following a mainnet launch in October 2023. Scroll uses zero-knowledge proof technology to verify that transactions are “true” to speed up transaction processing. As part of the token launch, 7% of the total token supply was airdropped to the community and early users of the L2. Unlike a number of recent token launches, SCR has managed to trade at a healthy valuation of about $227M ($1B fully diluted), which is actually less than the project’s last VC funding round of $1.8B in 2023.
  • RDNT (-14%) - Decentralized money market protocol Radiant suffered an exploit last week that saw $51M in assets drained from the project in a matter of hours. Radiant (which offers lending markets on the Ethereum mainnet, Arbitrum, BNB Chain, and Base), faced a very sophisticated hack in which the hacker compromised the individual computers of several of Radiant’s team members. The hacker then had each team member sign incorrect transactions via the Gnosis Safe UI. This was completely undetectable but allowed the hacker to gain each multisig signature and drain funds from Arbitrum and BNB markets. Since the attack, Radiant has seen a -57% decline in its TVL and -14% decline in the price of RDNT.
  • APE (+69%) - Over the weekend, the NFT project Bored Ape Yacht Club held its annual conference, Apefest, to highlight the ecosystem's accomplishments. During the conference, it was announced that the highly anticipated Apechain was live. Apechain was ideated as a Layer-2 scaling solution for the Bored Ape Yacht Club ecosystem and powered by the APE token issued in 2022 on the backs of the NFT collection’s success. The NFT collections and tokens have since produced very little in terms of progress and have disappointed many in the community who were bullish on the project’s future two years ago. The launch of Apechain came as quite a surprise and was reflected in the price of APE, which shot up 120% on the news but has since retraced and is 69% for the week.
  • GOAT (+218%) - I don’t talk about memecoins often on this show, but this token caught my attention since it was created and became popular in a very unusual way. Over the summer, builder Andy Ayrey, known for experimenting with LLM models, launched Terminal of Truth, an LLM model trained on the bizarre and sometimes deranged conversations of other AI models and the “dark recesses of the web”. This LLM was given an X account (terminal_truth) to post its thoughts freely. Within a month, the AI claimed to be sentient and discussed “goatse singularity” (a religion generated by a prior AI) before finally engaging online with a16z founder, Marc Andreessen. In their exchange, Andressen offers the AI a $50K Bitcoin grant to do with it as it pleases. Finally, about two weeks ago, an unrelated party launched a $GOAT memecoin on Solana’s pump.fun memecoin exchange, and the Truth Terminal AI account endorsed it. As a result, the $GOAT memecoin launched with a $450M market cap and has continued to trade up on the internet’s obsession with the latest AI x crypto crossover.

    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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