Despite Increase in Supply on Exchanges, MKR’s Value Rises by 75% Year-to-Date
Recent data from Sanbase has shown that the supply of Maker (MKR) on cryptocurrency exchanges has increased by over 13% since 30 December 2022. At present, 8.63% of the token’s supply is held on crypto exchanges, up from just 7% at the beginning of December.
Typically, an increase in the supply of a cryptocurrency on exchanges indicates that more investors are interested in selling off their tokens instead of holding them. This, in turn, increases selling pressure, which can drive down the price of the asset.
However, in the case of MKR, this increase in supply on exchanges has coincided with a rise in price. According to CoinMarketCap, MKR’s value has increased by 75% year-to-date, with a nearly 40% price surge over the last month while the rest of the market remained stagnant.
Despite this surge, many MKR holders continue to record losses on their holdings due to the MVRV ratio being pegged below 1. The MVRV ratio is a metric that compares the current price of an asset to its realized price, i.e., the average price at which all units of the asset have last moved on-chain. When this ratio is below 1, it implies that many holders are still holding their MKR at a loss, and there is potential for further selling pressure.
Overall, the increase in MKR supply on exchanges is a development to watch closely, as it could indicate potential selling pressure and a subsequent price decline. However, the rise in MKR’s value in the face of this increased supply is a positive sign, and investors will be keeping a close eye on the cryptocurrency’s performance in the coming weeks.
Read more:
- MakerDAO Proposes MKR As Collateral For Borrowing DAI In New Endgame Plan
- MakerDAO Reactivates Direct Deposit Module Program With Aave As First Partner
- MakerDAO Clarifies Its Role In Recent Transactions Involving Maker Vault 30100