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Here’s why analysts say SUSHI tokens are worth only $0.31

Sushi, the governance-cum-liquidity pool tokens for SushiSwap, have seen an unexpected boom in their nascent lifespan in terms of both prices and controversies.

The post Here’s why analysts say SUSHI tokens are worth only $0.31 appeared first on CryptoSlate.

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Sushi, the governance-cum-liquidity pool tokens for SushiSwap, have seen an unexpected boom in their nascent lifespan in terms of both prices and controversies.

Not only did the token’s founder, the anonymous Twitter account “Chef Nomi,” sell over $10 million in return for their “week’s worth” of work before handing over admin keys to FTX founder Sam Bankman-Fried, but Sushi prices also zoomed nearly 1,300% from a few cents to over $12.40.

However, one company says that the supposed utility of the Sushi token, that of allowing decentralized governance based on community inputs, is overstated and is likely behind the token’s massive overvaluation.

Inflation leading to unsustainable prices

In a blog post this week, on-chain analytics firm Glassnode said Sushi served these two fundamental points for users:

  1. Revenue share – The SushiSwap protocol takes a 0.3% fee on each trade; 0.25% goes to liquidity providers, and the remaining 0.05% is converted into SUSHI and distributed to SUSHI token holders as the 0.05% reward amount.
  2. Governance – SUSHI holders can use their tokens to vote on governance proposals regarding changes and upgrades to the protocol.

However, Glassnode analyst Liesl Eichholz expressed her concerns, “although the value of protocol governance should not be understated, it is difficult to quantify.”

“Similarly, the hype value of yield farming projects (especially in markets such as these) is not easily quantifiable,” she said.

Image: Glassnode

Eichholz pointed out that SushiSwap’s primary mechanism of rewarding liquidity providers with Sushi tokens to sell on the open market to book profits led to drastic inflation, one that benefited pool holders but not retail investors.

“Investors should be aware: anyone holding SUSHI without providing liquidity will be diluted. As such, investors looking at buying SUSHI should do so with caution and with an understanding of the risks behind the underlying token mechanics.”

Sushi just $0.13?

While SushiSwap has an in-built 0.05% buyback mechanism that can help maintain its inflation rate; a certain amount of daily trading volume must be sustained to maintain a given price.

Image: Glassnode

And that’s wherein the valuation issue arises. The report said that without significantly high volumes, SUSHI prices above $10 were “preposterous and unsustainable.”

Eichholz noted:

“In reality, assuming that SushiSwap captures a more realistic daily trading volume of $400 million, the sustainable price for SUSHI would be $0.31 – a full 97% lower than its all-time high of $11.93.”

But that does not necessarily mean a decline for Sushi prices in the short-term. Eichholz stated prices were likely to remain inflated in the short term due to hype and a lack of fundamental understanding among retail investors.

Sushi trades at $2.30 at press time as per data on FTX. It is down over 81% from an all-time high of $12.40 on September 1.

Posted In: Analysis, DeFi

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Source: https://cryptoslate.com/heres-why-analysts-say-sushi-tokens-are-worth-only-0-31/

Blockchain

Bitcoin’s Dominance Rises as BTC Reached a 4-Day High at $35,500 (Market Watch)

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Although bitcoin failed to continue upwards after its intraday high of $35,500, its dominance over the market has increased further. This comes as most alternative coins have stalled, except for Dogecoin, which is up by double-digits.

BTC Dominance on the Rise

After the mid-week crash, in which bitcoin slumped below $30,000 for the first time since January, the asset’s performance has been calmer. It recovered most losses and even spiked to just shy of $35,000 on the following day but failed to continue higher as reported.

The bears drove it south to around $32,000, but the trajectory quickly reversed in the following hours. BTC started climbing again and added more than $3,000 of value.

As a result, it charted a four-day high of approximately $35,500. Despite losing over a grand since then, its dominance over the market has actually increased.

The metric comparing BTC’s market capitalization with all other cryptocurrencies is up to 47%.

BTCUSD. Source: TradingView
BTCUSD. Source: TradingView

Alts Stall While DOGE Pumps

Most of the alternative coins have remained stagnant on a 24-hour scale. Although Ethereum recovered from its most violent stages of the crash, it still fails to overcome $2,000 decisively. As a result, ETH trades just north of $1,900 for a second consecutive day.

Binance Coin jumped higher in the past 24 hours and even exceeded $310 at one point, but has retraced since then and is currently around $290. Cardano, Polkadot, Bitcoin Cash, and Chainlink are slightly in the red since yesterday.

In contrast, Ripple, Uniswap, Litecoin, and Solana have marked minor gains. Dogecoin is the most impressive performer once more from the larger-cap alts following a 10% increase to $0.26.

Cryptocurrency Market Overview. Source: Quantify Crypto
Cryptocurrency Market Overview. Source: Quantify Crypto

More fluctuations come from lower- and mid-cap alts. Celo (20%) has surged the most, followed by Nano (16%), Siacoin (12%), THORChain (12%), Curve DAO Token (11%), and Waves (10%).

Klaytn has lost the most from yesterday after a 14% drop. Nevertheless, the cumulative market capitalization of all cryptocurrency assets has remained just shy of $1.4 trillion.

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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.


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Source: https://cryptopotato.com/bitcoins-dominance-rises-as-btc-reached-a-4-day-high-at-35500-market-watch/

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Blockchain

Elon Musk Agrees to Have the Bitcoin Talk With Jack Dorsey

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After laughing at Jack Dorsey’s proposition for a Bitcoin conference earlier, Elon Musk has actually agreed to a BTC conversation with the CEO of Twitter at the event.

  • As reported earlier, Elon Musk likes to have fun with the cryptocurrency community. Perhaps that’s why he initially laughed at Jack Dorsey’s most recent Bitcoin endeavor.
  • The CEO of Twitter announced plans to hold a designated BTC event aiming to “help protect and spread what makes bitcoin open development so perfect.”
  • After the initial laughter from Tesla’s CEO, though, Dorsey asked Musk to have a conversation at the event where the latter could share all of his “curiosities.”
  • Later on, Musk indeed agreed to have “THE talk” at the event, which should take place on the 21st of July this year.
  • Apart from Dorsey, some of the other popular names that will speak at the conference include the CEO and CIO of ARK Invest, Cathie Wood, and the CEO of Blockstream, Adam Back.
  • With this event, Twitter’s CEO continues to reaffirm his support for the primary cryptocurrency.
  • During the 2021 Bitcoin Conference in Miami, he called the asset the most important work of his lifetime. Furthermore, he said he would leave Twitter and Square if BTC needed him.
  • His personal Twitter account continues to display only one word – bitcoin. Additionally, he partnered with the legendary rapper Jay-Z to donate 500 BTC to fund developers working on the network.
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Source: https://cryptopotato.com/elon-musk-agrees-to-have-the-bitcoin-talk-with-jack-dorsey/

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Blockchain

SOLANAX Private Sale Is On For The Cross-Chain DEX

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[PRESS RELEASE – Please Read Disclaimer]

The cryptocurrency market has left people wondering about the long-term growth prospects and which cryptocurrency they should invest in. Solanax is an automated market maker (AMM) based on the Solana blockchain, which is set to be a game-changer in the cryptocurrency world.

The SolanaX Platform

After parsing through their team of professionals, whitepapers, their project plans, and unique platform capabilities, there is no doubt that once the platform is up and running in full swing, it will undoubtedly change the way people transact today with its simple interface for the public to trade at a record higher blockchain speed and lower gas fees.

  • There are no time-consuming processes or intermediaries.
  • It offers a very simple interface and lower gas fees while initiating the transactions.
  • Solanax increases blockchain speed and makes it more convenient to transact than its peers in the cryptocurrency market.
  • As Solanax is based on Solana’s Proof-of-History verification concept rather than a Proof-of-Work system (as that of Ethereum’s), it will enable users to leverage Solanax’s phenomenal transaction capabilities (Solanax to handle thousands of transactions in a second as compared to Ethereum’s 15).
  • The most crucial part is that while speeding up blockchain transactions and lowering gas prices, Solanax does not compromise on the security aspect.

The Ongoing Private Sale Of Solanax

Solana blockchain is substantially faster compared to its peers, and the ongoing private sale is an opportunity for crypto enthusiasts and investors to participate in this game-changer prospect.

The private sale is still ongoing until Friday, 25th June.

Total Supply: 80 000 000 SOLD Tokens

There will be 20 Million SOLD Tokens distributed before the CEX listing.

Private Sale: Total available token supply – 10,000,000 SOLD

Period: From 06/06/2021 to 25/06/2021

Token Price: $0.1 with a 3months vesting period

Token Price: $0.15 w/o vesting period

Initial Exchange Offering: Total available supply – 10,000,000 SOLD

Final Words

Solanax aims to revolutionize the DeFi exchange network and enhance efficiency levels to new highs. With DeFi gaining popularity, there is an urgent need for the industry to look beyond the older cryptocurrency platforms like Bitcoin and Ethereum. The sluggish transaction speed is one of the prime reasons for Solanax not preferring the Ethereum-like platforms. Besides, Solanax, with its high blockchain speed, simple interface, and low gas fees, is truly a game-changer for crypto aficionados, and Solanax’s Ongoing Private Sale presents the perfect investment opportunity for investors.

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Source: https://cryptopotato.com/solanax-private-sale-is-on-for-the-cross-chain-dex/

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