Spark protocol coming to Gnosis chain fuels positive sentiment among MKR holders. MKR bulls show strong momentum and resilience, but will selling pressure be imminent?
Maker DAO’s native token MKR made headlines after rallying more than 50% in the past seven days. This makes it one of the best performing cryptocurrencies in the aforementioned period.
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MKR owes this performance to a series of favorable events that have taken place over the past few days. One such event is the extension of the Spark protocol to the Gnosis chain. A move that could lead to more utility and demand for the DAI stablecoin. The main advantages are the high degree of decentralization of the Gnosis chain and the lower transaction costs.
According to ASXN, MKR is up more than 40% in the past 7 days due to the Smart Burn Engine proposal, the expansion of the Spark protocol, the implementation of the MKR buyback contract and the growth of fee capturing (annual revenue of $117 million). A group of addresses with similar…
— Wu Blockchain (@WuBlockchain) July 6, 2023
MKR also owes its robust bullish performance to other factors, such as the deployment of MKR buyback contracts and fee growth. But how impressive was the growth? Well, a look at the price action revealed it was trading as low as $870 for the past seven days. It bounced off its 200-day moving average and rose to $1080.
Source: TradingView
Will MKR surrender to the bears’ mercy?
While we may not be sure whether MKR will continue to rise or give up recent gains, some metrics offered useful insights. For example, on-chain volume just peaked in the last 24 hours at a new monthly high. Perhaps a sign that private buyers have been buying near the latest highs.
Source: Sentiment
One of the main reasons why observed volume is important is because of exit liquidity. Maker’s network growth also peaked at a new monthly high on July 3. However, it has since declined and approached the lower monthly range.
While network growth may look bearish, it’s worth noting that MKR is holding onto most of its recent gains so far. This is partly because the whales have also started buying. The latest data on the supply of top addresses showed a slight increase.
Source: Sentiment
How much are 1,10,100 MKRs worth today?
The supply of top addresses confirmed that whales are still buying at higher price levels. A sign that the near-term bullish outlook remains strong. It may also mean that strong selling pressure was not expected. As such, the MVRV ratio turned back up.
MKR’s ability to resist the downside will largely depend on whether investors are incentivized to hodl. The easiest way for that to happen is if the crypto market continues its bullish bias.
This post Maker [MKR] delivers a weekly increase of 50% fueled by these events
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