Pyth Network (PYTH) - a project belonging to the Oracle segment in blockchain, specializing in providing and transmitting data for blockchains, was listed on Binance in early 2024. To date, PYTH price has returned to the old Dip area, and has likely to soon establish a new Dip in May.
Here are the latest assessments from BeInCrypto on Pyth Network (PYTH) volatility.
PYTH is about to unlock a large amount of Token , up to 140% of the circulating supply
One case of unlocking Token exceeding the circulating supply has led to a strong panic sell, which is AEVO. AEVO's price has even dropped lower than its lowest level when it was listed on Binance. The sudden increase in AEVO circulating supply is because AEVO was formerly Ribbon Finance (RBN), and allowed holders to convert RNB to AEVO.
Therefore, this unlock of PYTH suffers two impacts at the same time.
PYTH Token unlock schedule. Source: Token unlock.- The first impact is the lesson learned by AEVO just a few days ago, investors may be ready to sell early because they fear that when unlocked, the price will drop even deeper. This could cause PYTH to drop sharply before the unlock occurs.
- The second impact is that the supply coming into circulation is up to 2.13 billion PYTH, while the current number of Token in circulation is only 1.5 billion. A sudden increase in total circulating supply, in a context where the market has not yet prospered, can lead to unpredictable price consequences.
The subjects receiving unlocked PYTH that can put pressure on selling are Private Sales with 250 million PYTH, Publisher Rewards with 537 million PYTH. The rest is for ecosystem and protocol development.
How far can Pyth Network (PYTH) go?
From a technical perspective, PYTH shows the following price characteristics:
Technical analysis of PYTH daily frame with Sonic R and Volume Profile.- Currently, PYTH is at the best support in price history at the 0.4 USD zone, this is the Point-of-Control (POC) zone of the Volume Profile indicator. However, the reaction of PYTH price does not show a strong recovery, basically the price is just stopping the decline at this support.
- The two lines EMA34 and EMA89 of the Sonic R indicator have confirmed a negative crossover. In a positive situation, if PYTH recovers, resistance will be near the 0.5 USD area. The nearest support below is the 0.25 USD area, this is the area where recovery is expected in a situation where the price drops sharply.
In addition, the 0.25 USD area is also the border area of the entire Volume profile since going public until now. If the price falls below this zone, there is no longer any reference data to predict the next Dip .
How is the market valuing Oracle projects?
How deeply the price of PYTH can fall or increase will depend on how the market is Capital projects in the Oracle segment.
Ranking of projects in the Oracle segment. Source: CoinmarketCap.- Chainlink (LINK) is still the leading project in the Oracle segment in the market with a Capital of more than 9 billion USD. Bittensor (TAO) is better known to users as a project in the AI field. And then comes PYTH. Investors XEM LINK as a competitor of PYTH. However, the current Capital gap between these two leading Oracle projects is too large, PYTH's Capital is currently only 635 million USD.
- And compared to the rest of the list above, the Medium Capital of projects in the Oracle segment is only about 250 million USD. If PYTH has more outstanding points, Capital may exceed this number but PYTH price will still be very low compared to investors' long-term expectations.
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