LUCKNOW (CoinChapter.com) — The crypto market has been a battleground in the wake of the SEC’s lawsuit against Binance and Coinbase in June 2023.
Uniswap (UNI), a leading decentralized exchange (DEX), has been a topic of significant discussion among the players. Following the lawsuit, UNI made a noteworthy surge on the gainers’ charts, with its daily transaction volumes soaring above $800 million.
A notable twist came mid-July when the SEC lost its protracted legal battle against Ripple (XRP). While Ripple’s victory has spurred investor confidence, the implications for Binance and Coinbase are yet to fully unfold.
Uniswap Faces Challenges Amidst Resurgent Centralized Exchanges
The aftermath of these events has revealed a shift in the market landscape, particularly as the focus pivots towards South Korean centralized exchanges, with UpBit leading the charge. This transition of attention from decentralized exchanges like Uniswap to centralized exchanges has started to affect UNI’s traction.
On-chain data analyzed by Santiment indicates that Uniswap’s user-acquisition rate has slumped to a two-month low.
As of August 21, a mere 185 new addresses have joined the Uniswap network. This drop mirrors a similar decrease experienced around the time of the SEC’s lawsuits against Binance and Coinbase in early June.
Network Growth estimates the influx of new users into a blockchain network by monitoring the daily creation of wallet addresses. As depicted above, the decrease in user acquisition was initiated around July 21, a mere week after Ripple’s triumph over the US SEC.
Evidently, the decline in UNI Network Growth to a two-month nadir implies a potential link between the decrease in Uniswap’s user acquisition and the resurgence of Centralized Exchanges (CEXs) in August. Should this trend persist, the UNI token might encounter challenges securing adequate demand to counteract its ongoing price decline.
Strategic Whales Bolstering UNI
Amid these challenges, Uniswap has found an unexpected ally in strategic whales. These crypto whales, holding between 100,000 and 1 million UNI tokens, took advantage of the recent price dip between August 13 and 21. During this period, they bolstered their holdings by a staggering 3.25 million UNI tokens.
Despite the downward pressure on UNI’s price, this strategic move has raised eyebrows. With the current price of $4.66, the whales’ cumulative acquisition is valued at over $15.5 million. Their willingness to invest substantially during a dip signifies a strong belief in Uniswap’s long-term potential.
Price Predictions and Potential Scenarios
Looking ahead, market analysts are evaluating various potential scenarios for UNI’s price movement. The “In/Out of Money Around Price” data furnishes valuable insights into the distribution of purchase prices among current Uniswap investors.
This data bolsters the notion that UNI’s price could respond to the decrease in user acquisition by edging slightly lower, possibly hovering around $4. However, over 2,220 addresses are positioned to provide support at the minimum price of $4.53.
Conversely, if the whales’ buying pressure continues, a neutral price trend could emerge, consolidating near the $7 mark. However, resistance is anticipated at around $5.40, where many addresses hold 32 million UNI tokens.