The team at Solana-based DeFi protocol, Solend, recently liquidated a whale’s account, ostensibly to mitigate risks posed to the Solana network.
A vote was undertaken by the Solend community on whether or not to take temporary control of the whale’s account and liquidate its holdings through an over-the-counter (OTC) trade.
Among the major concerns was that with the price of SOL dropping to US$22.30, the whale’s account would liquidate up to 20 percent of borrows, estimated at around US$21 million, and in such event could have landed Solend with a significant amount of bad debt.
Potential Chaos Alert
Apparently, but for Solend’s actions, liquidations would otherwise have placed significant strain on the Solana network, and liquidators would be especially active and spam the liquidate function – which has been a known factor causing Solana to go down in the past:
Solana has a history of downtime caused by on-chain liquidations like this (but 100x bigger this time). It's extremely risky for everyone involved.
In the future, on-chain OTC auctions should be implemented as the preferred method for liquidating large positions.
— Solend (we're hiring!) (@solendprotocol) June 19, 2022
Solend Forced to Take Decisive Action
Despite its best efforts, the team at Solend has been unable to contact the whale via on-chain messages to reduce the risk, forcing it to take decisive action:
— Solend (we're hiring!) (@solendprotocol) June 18, 2022
Options presented to the community included doing nothing, which would present a systemic risk to Solend and its users. Allowing liquidations of this magnitude to happen on-chain is risky as the DEX liquidity isn’t deep enough to handle a sale of this size and could cause cascading effects.
The team at Solend decided that any action taken had a set of trade-offs to consider and it posed a vote to the community with two possible outcomes:
Vote Yes – enact a special margin requirement for large whales that represents over 20 percent of borrows and grant emergency power to Solend Labs to temporarily take over the whale’s account so that liquidation can be executed OTC; or
Vote No – do nothing.
Votes were cast and the community voted yes:
Governance proposal SLND1 has passed.
Special margin requirements for accounts that represent over 20% of borrows are now in effect.
There will be a grace period for 3oSE…uRbE to reduce their leverage by themselves. pic.twitter.com/dsZhFRC8ZX
— Solend (we're hiring!) (@solendprotocol) June 19, 2022
Let’s take a closer look at today’s altcoins showing breakout signals. We’ll explain what the coin is, then dive into the trading charts and provide some analysis to help you decide.
1. Solana (SOL)
Solana SOL is a highly functional open-source project that banks on blockchain technology’s permissionless nature to provide decentralised finance (DeFi) solutions. The Solana protocol is designed to facilitate decentralised app (DApp) creation. It aims to improve scalability by introducing a proof-of-history (PoH) consensus combined with the underlying proof-of-stake (PoS) consensus of the blockchain.
SOL Price Analysis
At the time of writing, SOL is ranked the 9th cryptocurrency globally and the current price is US$30.10. Let’s take a look at the chart below for price analysis:
SOL has retraced 87% from its Q2 highs and reached possible support last week near $26.34. Resistance might begin near $33.64, which has confluence with the 9 and 18 EMAs.
A more substantial rally might reach near the swing high at $37.23 and the 40 EMA. This high is less likely to break if bears plan to continue the downtrend without a lengthier consolidation.
While not highly probable in the current market conditions, a more animated move upward could reach a wide resistance area between $40.42 and $45.94. This zone is where the last movement down accumulated positions before breaking down.
Possible support rests near $25.34, which showed sensitivity on the last test. While it could provide support again, the higher-timeframe bearish trend is more likely to propel the price into an inefficient area between $23.10 and $20.54. If the price reaches this zone, the Q1 2021 swing high near $17.12 might mark a more sensitive level.
2. Cardano (ADA)
Cardano ADA is a proof-of-stake blockchain platform whose stated goal is to allow “changemakers, innovators, and visionaries” to bring about positive global change. The open-source project also aims to “redistribute power from unaccountable structures to the margins to individuals”, helping to create a society that is more secure, transparent, and fair. Cardano is used by agricultural companies to track fresh produce from field to fork, while other products built on the platform allow educational credentials to be stored in a tamper-proof way, and retailers to clamp down on counterfeit goods.
ADA Price Analysis
At the time of writing, ADA is ranked the 7th cryptocurrency globally and the current price is US$0.4951. Let’s take a look at the chart below for price analysis:
ADA‘s near 60% drop during Q2 found a low near $0.4335 during early June before closing over a short-term high.
This daily close over the high could signal a shift in market structure that may reach probable resistance near $0.5915. A sustained bullish move may target the swing high at $0.6322. If this stop run occurs, a run beyond the high into probable resistance near $0.7210 and $0.7719 is possible.
Bulls could buy a retracement to possible support near $0.4570, just above the weekly open. A bearish turn in the marketplace may propel the price toward possible support near $0.4325.
However, relatively equal lows near $0.4057 and $0.3922 provide an attractive target for bears if the market resumes its bearish trend. A run on these lows might find support between $0.3647 and $0.3552.
3. Axie Infinity (AXS)
Axie Infinity AXS is a blockchain-based trading and battling game that is partially owned and operated by its players. The Axie Infinity ecosystem has its own unique governance token, known as Axie Infinity Shards AXS. These are used to participate in key governance votes and give holders a say in how funds in the Axie Community Treasury are spent.
AXS Price Analysis
At the time of writing, AXS is ranked the 49th cryptocurrency globally and the current price is US$14.05. Let’s take a look at the chart below for price analysis:
AXS‘s relatively small 20% range could suggest that a recovery is setting up in June.
Aggressive bulls could look for entries at the most recent area of support formed near $13.34. However, equal lows near $12.42 make a tempting target for a stop run into this support. This move could reach support near $11.90.
A decisive move to the downside could run stops below the second set of relatively equal lows near $11.20, possibly reaching support at an old swing high and a daily gap near $10.58.
A recent level near $17.84 provided resistance and caused a swing high to form near $19.88, offering first targets. A move through this high may arrive at new monthly high levels near $20.31 and $23.50.
These coins have high liquidity on Binance Exchange, so that could help with trading on AUD/USDT/BTC pairs. And if you’re looking at buying and HODLing cryptos, then Swyftx Exchange is an easy-to-use popular choice in Australia.
Solana has rejected the safety ranking of “second-worst” that it received from DeFi Safety this week after the DeFi watchdog raised concerns over the platform’s frequent downtime and unsatisfactory node structure:
1/28 Due to repeated downtime, @solana has the second worst final technical risk score of the 15 chains that we have reviewed so far. Only @Ronin_Network has a lower score at this point. This is for a variety of reasons. 🫤 pic.twitter.com/GLhugXmPi8
There are five different criteria that DeFi Safety uses in its blockchain evaluations: security and testing, node count, node diversity, documentation, and supporting software. The concerns raised by the watchdog predominantly revolve around the lack of transparency from the network’s archive node, alongside Solana’s processes for storing the blockchain’s data.
Beyond the platform’s insufficient node clients (software aiding users in connecting to the blockchain), Solana’s repeated downtime was a decisive factor for DeFi Safety.
Solana presents systemic technical risk. There is no doubt about it. User funds, in our eyes, are at risk. We penalise them heavily for downtime because users cannot access their funds when the chain goes down.
DeFi Safety Twitter – @DeFiSafety
Presently, Solana has only a single piece of software for its node operators, which DeFi Safety claims has not been audited since 2019. However, the report isn’t entirely negative as the watchdog has given the platform credit for aspects where it performs well.
Credit where it’s due, Solana has made significant strides in validation decentralisation. Thanks to an impressive program that incentivises many validators on other continents, Solana scores well on this point.
DeFi Safety Twitter – @DeFiSafety
More than 15 blockchains and 240 decentralised finance protocols have been reviewed by DeFi Safety so far. Ronin blockchain, Axie Infinity’s popular play-to-earn gaming platform, was ranked the worst. Ronin was hacked for US$625 million in March, in what was the biggest DeFi hack to date.
Solana’s Plagued Past
Heavy downtime has plagued Solana for some time, with several instances over past months inconveniencing users. On January 6, Solana crashed temporarily following a Distributed Denial of Service (DDoS) attack which caused massive transaction delays. Upsettingly, a second crash followed in the same week. Solana denied it was due to another potential DDoS attack, claiming the downtime was the result of an increase in high compute transactions.
Last month, Solana was down for seven hours after bots attacked ‘Candy Machine’, the platform’s NFT minting tool, causing four million transaction requests that the platform could not keep up with.
Let’s take a closer look at today’s altcoins showing breakout signals. We’ll explain what the coin is, then dive into the trading charts and provide some analysis to help you decide.
1. Binance Coin (BNB)
Binance BNB is the biggest cryptocurrency exchange globally, based on daily trading volume. Binance aims to bring cryptocurrency exchanges to the forefront of world financial activity. Aside from being the largest cryptocurrency exchange, Binance has launched a whole ecosystem of functionalities for its users. The Binance network includes the Binance Chain, Binance Smart Chain, Binance Academy, Trust Wallet, and Research projects, which all employ the powers of blockchain technology to bring new-age finance to the world. Binance Coin is an integral part of the successful functioning of many of the Binance sub-projects.
BNB Price Analysis
At the time of writing, BNB is ranked the 5th cryptocurrency globally and the current price is US$303.12. Let’s take a look at the chart below for price analysis:
After a 45% decline from early May, BNB has ranged between $280 and $335. The recent price recovery was approaching probable resistance near $340 but could be aiming for stops above the relatively equal highs near $356. Continuation of the trend could target the daily gap near $374.
Aggressive bulls might add to positions near $301 and $294. Price action near $390 may be more likely to provide support – if it gets there – during any retracements.
Relatively equal lows clustered around $285 seem likely to be swept if the bearish trend resumes. If this move occurs, the price might find support at the significant higher-timeframe level near $273.
2. Solana (SOL)
Solana SOL is a highly functional open-source project that banks on blockchain technology’s permissionless nature to provide decentralised finance (DeFi) solutions. The Solana protocol is designed to facilitate decentralised app (DApp) creation. It aims to improve scalability by introducing a proof-of-history (PoH) consensus combined with the underlying proof-of-stake (PoS) consensus of the blockchain.
SOL Price Analysis
At the time of writing, SOL is ranked the 9th cryptocurrency globally and the current price is US$44.86. Let’s take a look at the chart below for price analysis:
SOL has retraced 85% from its April highs and reached possible support last week near $40.34. Resistance might begin near $58.34, which has confluence with the 9 and 18 EMAs.
A more substantial rally might reach near the swing high at $64.23 and the 40 EMA. This high is less likely to break if bears plan to continue the downtrend without a lengthier consolidation.
While not highly probable in the current market conditions, a more animated move upward could reach a wide resistance area between $67.42 and $70.94. This zone is where the last movement down accumulated positions before breaking down.
Possible support rests near $40.34, which showed sensitivity on the last test. While it could provide support again, the higher-timeframe bearish trend is more likely to propel the price into an inefficient area between $38.10 and $36.54. If the price reaches this zone, the Q1 2021 swing high near $33.12 might mark a more sensitive level.
3. Loopring (LRC)
LRC is the Ethereum-based cryptocurrency token of Loopring, an open protocol designed for the building of decentralised crypto exchanges. Loopring’s purported goal is to combine centralised order matching with decentralised on-blockchain order settlement into a hybridised product that will take the best aspects of both centralised and decentralised exchanges.
LRC Price Analysis
At the time of writing, LRC is ranked the 68th cryptocurrency globally and the current price is US$0.4885. Let’s take a look at the chart below for price analysis:
LRC lifted off last week, with the impulse sweeping the new swing highs into resistance up to $0.6534.
If the price retraces now that it has taken highs, aggressive bulls could look for entries at the recently broken resistance between $0.5106 and $0.4650. A deeper retracement that fills the gap down to the monthly level at $0.4460 provides a better entry, with any quick drops near the monthly open at $0.4058 providing the most favourable entries.
Continuation through the current resistance around $0.6419 is likely to explode through the remaining daily highs stacked up to $0.7328. There’s no telling how far the price could go beyond these new monthly high prices.
These coins have high liquidity on Binance Exchange, so that could help with trading on AUD/USDT/BTC pairs. And if you’re looking at buying and HODLing cryptos, then Swyftx Exchange is an easy-to-use popular choice in Australia.
In what Brave describes as its first steps toward full integration with the Solana ecosystem, it will also offer support for Solana’s decentralised applications (dApps), allowing them to run natively within the browser.
We've partnered with @solana to integrate it into the browser and make it the default for DApp support. We will soon bring best-in-class wallet features for the Solana blockchain into our desktop & mobile browsers. #BreakpointLisbonhttps://t.co/tTB7NXKWjI
Addressing the Breakpoint conference in Lisbon, Portugal earlier this week, Brave CEO and co-founder Brendan Eich said the browser’s default support for Solana would help provide fast and affordable Web3 access and thus “pave the way for the next billion crypto users”, adding that he expected the integration process to be completed by the end of June.
The partnership brings the Solana blockchain to Brave’s 42 million monthly active users and 1.3 million verified creators. In return, Solana will implement Themis, a privacy-by-design advertising protocol considered a key milestone in the BAT 2.0 roadmap.
Over the past week, the Solana (SOL) token became the fourth-largest cryptocurrency by market capitalisation, overtaking Cardano and stablecoin provider Tether.
Retail investors are deserting the crypto market, with just over three-quarters of Q1 2022 trading volume at Coinbase coming from institutional investors, according to the exchange’s most recent letter to shareholders.
Retail investors are leaving the crypto market.
Not bad for accumulating #Bitcoin with institutions, but still worried about overall volume which is significantly decreased compared to last year. pic.twitter.com/0XtRwc3eNp
Support for BTC, ETH Holds Up Amid Terra Bloodbath
In spite of the past week’s crypto market downturn precipitated by the collapse of Terra’s $LUNA and its UST stablecoin, institutional investors are banking on the flagship cryptocurrency Bitcoin (BTC) and Ethereum rival Solana (SOL).
Latest analysis as per Bitcoin’s Fear & Greed Index. Source: alternative.me
According to CoinShares, BTC investment products saw US$45 million in inflows over seven days as assets under management fell to levels “seen during the lows in sentiment at the beginning of the year”.
Negative sentiment towards Ethereum contributed to outflows of US$12.5 million in the same period, bringing ETH outflows year-to-date to US$207 million, or 0.8 percent of assets under management.
Solana’s SOL the Sole Altcoin with ‘Substantial Inflows’
Last week, Ethereum rival Solana’s SOL was the “sole altcoin to see any substantial inflows”, totalling US$1.9 million.
With the price of bitcoin having shrunk more than one-third and the overall crypto market cap down by 38 percent, falling prices have led to unrealised losses for at least 40 percent of bitcoin investors.
Flying in the face of market gloom, the richest bitcoin whale splurged US$90 million on BTC in less than a month. Last week, blockchain intelligence platform IntoTheBlock disclosed that bitcoin whales collectively added to their holdings amid the crypto sell-off, with just over 50 percent of BTC holders still in profit.
Let’s take a closer look at today’s altcoins showing breakout signals. We’ll explain what the coin is, then dive into the trading charts and provide some analysis to help you decide.
1. Solana (SOL)
Solana SOL is a highly functional open-source project that banks on blockchain technology’s permissionless nature to provide decentralised finance (DeFi) solutions. The Solana protocol is designed to facilitate decentralised app (DApp) creation. It aims to improve scalability by introducing a proof-of-history (PoH) consensus combined with the underlying proof-of-stake (PoS) consensus of the blockchain.
SOL Price Analysis
At the time of writing, SOL is ranked the 8th cryptocurrency globally and the current price is US$53.37. Let’s take a look at the chart below for price analysis:
SOL has retraced 80% from its Q1 highs and reached possible support last week near $50.34. Resistance might begin near $80.34, which has confluence with the 9 and 18 EMAs.
A more substantial rally might reach near the swing high at $87.23 and the 40 EMA. This high is less likely to break if bears plan to continue the downtrend without a lengthier consolidation.
While not highly probable in the current market conditions, a more animated move upward could reach a wide resistance area between $94.42 and $98.94. This zone is where the last movement down accumulated positions before breaking down.
Possible support rests near $50.34, which showed sensitivity on the last test. While it could provide support again, the higher-timeframe bearish trend is more likely to propel the price into an inefficient area between $47.10 and $44.54. If the price reaches this zone, the Q1 2021 swing high near $40.13 might mark a more sensitive level.
2. Polygon (MATIC)
Polygon MATIC is the first well-structured, easy-to-use platform for Ethereum scaling and infrastructure development. Its core component is Polygon SDK, a modular, flexible framework that supports building multiple types of applications. The MATIC token will continue to exist and will play an increasingly important role in securing the system and enabling governance.
MATIC Price Analysis
At the time of writing, MATIC is ranked the 18th cryptocurrency globally and the current price is US$0.7203. Let’s take a look at the chart below for price analysis:
Since its Q1 highs, MATIC has been in a steady bearish trend, retracing nearly 55%. The price found support near $0.7020, at the 60.8% retracement level.
Last week’s sharp impulse up might have marked the start of a new trend. If so, higher timeframes suggest that $0.6839 near the 65.8% retracement and the 9, 18 and 40 EMAs may see interest from bulls. The price could reach lower, near $0.6520, and still find support.
Currently, the price is contesting a region between $0.7139 and $0.7835. Closes over this level could confirm it as new support, leading to a move higher.
However, bulls are contending with probable resistance near $0.8344, while $0.9053 is also likely to be sensitive with the nearest support and resistance this close together.
3. Stellar (XLM)
Stellar XLM is an open network that allows money to be moved and stored. When it was released, the goal was boosting financial inclusion by reaching the world’s unbanked – but soon after, its priorities shifted to helping financial firms connect with one another through blockchain technology. The network’s native token, lumens, serves as a bridge that makes it less expensive to trade assets across borders. All of this aims to challenge existing payment providers who often charge high fees for a similar service.
XLM Price Analysis
At the time of writing, XLM is ranked the 27th cryptocurrency globally and the current price is US$0.1303. Let’s take a look at the chart below for price analysis:
XLM set a high near $0.2457 in early April before retracing nearly 45% to find a low near $0.1260. The price consolidated around this level before the strong bullish impulse over the past several days.
Probable resistance near $0.1578 is slowing the bullish advance down. However, another leg might target the last swing high at $0.1722 and relatively equal highs at $0.1936. Resistance near $0.2059 could cap the move before the second swing high. Beyond these levels, little stands in the bulls’ way before reaching the swing high near $0.2356.
A retracement before a move higher might find support in the daily gap near $0.1243, just above the weekly open. Relatively equal lows near $0.1175 could also provide support. Run-on stops at $0.1105 and $0.1083 might find support in the gap beginning near $0.1020.
These coins have high liquidity on Binance Exchange, so that could help with trading on AUD/USDT/BTC pairs. And if you’re looking at buying and HODLing cryptos, then Swyftx Exchange is an easy-to-use popular choice in Australia.
The beginning of May has seen a nearly seven-hour Solana crash, believed to be the result of a bot attack that targeted the company’s NFT minting tool ‘Candy Machine’ and has left users questioning the competence of the blockchain:
Solana Mainnet Beta lost consensus after an enormous amount of inbound transactions (4m per second) flooded the network, surpassing 100gbps. Engineers are still investigating why the network was unable to recover, and validator operators prepare for a restart.
A tidal wave of traffic slammed Solana’s ‘Candy Machine’ on April 30. The bots responsible caused four million transaction requests, totalling 100 gigabits of data per second and setting a record for the platform, which could not keep up.
Later that night, the validator operators performed a cluster restart of its Mainnet Beta network. However, it wasn’t fast enough to stop the criticism that echoed around social media from Solana users and onlookers:
it wasn't "paused" or "halted" – better to say it "crashed"
Solana’s plans to combat these crashes involve a botting penalty that is soon set to deploy to the program. It will only be the beginning of a broader effort but should work to stabilise the network, hopefully preventing similar issues in the future and stopping Solana from, negatively, being the talk of the town:
Basically, you guys turned it off and turned it back on again.
— ₿itcoin Gandalf The Orange 🟧 (@BTCGandalf) May 1, 2022
Not Solana’s First Outage
Solana has quite the track record of network outages. Notably, on January 4 the network was temporarily down due to a DDoS attack, causing huge transaction delays. Shockingly, this was followed by a second crash within the same week, believed to be a knock-on effect of the first attack.
As Solana continues to challenge Ethereum’s dominance of the NFT ecosystem, the former’s new profile picture project Okay Bears generated more trading volume on its first day than any rival’s.
With 10,000 unique avatars, Okay Bears launched this week on Solana NFT marketplace Magic Eden at a mint price of 1.5 SOL (about US$145) per NFT. Secondary market sales quickly surged, sending the price of the collection soaring and generating US$18.4 million in trading volume.
First For Solana in Terms of a Single Day’s Trading Volume
The stunning Okay Bears performance represents the first time a Solana NFT project has beaten individual Ethereum projects in terms of 24-hour trading volume.
“Solana projects have just as bright a future as projects on other chains,” said Tiffany Huang, Magic Eden’s head of content and marketing, with some understatement.
With a more than passing physical resemblance to Ethereum’s Bored Ape Yacht Club avatars, Okay Bears sport a random array of mix-and-match traits. And like BAYC, the creators of Okay Bears plan to reward holders with future NFT drops, additional perks and benefits.
According to Huang, the platform generated over 380,000 SOL (about US$37.4 million) of secondary trading volume in 24 hours, a record for Solana. Yet Ethereum retains the ascendancy with its recent MoonBirds NFT launch generating more than US$200 million on debut. Earlier this week, a single Moonbirds NFT changed hands for more than US$1 million.
According to analysis from CoinShares, investors have favoured smaller layer-one altcoins of late with institutional capital outflows from Ethereum hitting US$17 million:
According to a weekly report by asset management firm CoinShares, institutional investor funds flow to digital assets such as crypto assets (cryptocurrency) investment trusts have exceeded outflows for the second straight week. pic.twitter.com/kgT8iCuN9M
Institutional investors have been shifting their attention away from Ethereum to competing layer-one blockchain projects, with capital inflows for altcoins increasing while ETH products posted outflows for the third consecutive week. Data from CoinShares’ Digital Asset Fund report shows that investors bought up US$3.5 million worth of Avalanche, Solana, Terra, and Algorand.
The data shows total outflows of ETH now amount to US$59.3 million, around 35 percent of the year-to-date outflows of US$169 million.
Weekly Flows from ETH. Source: CoinShares
Decentralised application usage on Solana in the past week has increased, according to data from DappRadar. While the metrics from Avalanche’s DApp usage have not increased over the week, the project’s investment in incentive programs and millions spent bringing developers to the platform signal a bullish future.
Significant Shift in Past Three Weeks
Inflows into Avalanche, Solana, Terra and Algorand were US$1.8 million, US$800,000, US$700,000, and US$200,000 respectively, with Bitcoin recording inflows worth US$2.6 million for the first time in two weeks. Over the past three weeks, total outflows were US$219 million, a significant shift from the US$134 million that left the market in the first week of April.
In March, another report released by CoinShares showed that institutional crypto funds had seen their biggest capital inflows since December 2021, with over US$193 million coming in during the week ending March 25.
