Sirwin
Sirwin

Terra Era | Crypto Market Update 12.23


Overview

  • Terra Era
  • Crypto Market Update
  • Trade set-up DOT
  • Major News
  • NEWBIES’ Lesson of the day: What is TVL?

 


  Terra Era

We are entering Terra Era! Yes, I just coined that myself, but you’re welcome to use it.

Terra (LUNA), which has been mentioned in the newsletter since the beginning, has gone up 96% and is at $95. Today it surpassed Binance in TVL. Its TVL has grown by 56% in the last week! Scroll to the NEWBIES section below if you don’t know what TVL means. Terra now holds $20 billion in assets and is number two behind Ethereum. To give you an idea of how fast this chain has grown, on Jan 1, 2021, Terra only held $53 million in TVL.

1*Tc7U52pCyyQZXKCOHWnh-w.png

The primary catalyst of growth is the burn mechanism of LUNA to mint UST. I wrote about it in a previous report. The other is Anchor Protocol, which gives a whopping 20% APY on the UST stablecoin. Before Anchor, a typical APY for stablecoins was 5–10%. So why continue keeping dollars in a greedy bank that gives you less than 1% APY? Aspects like this help support the future thesis of crypto.

The other is Anchor Protocol, which gives a whopping 20% APY on the UST stablecoin

Terra is a young network, and the Columbus 5 upgrade in early November opened the gates to 200 plus protocols. Its focus remains on DeFi, but Terra is integrating protocols focused on NFTs, payments, metaverses, and even games.

Keep Terra on your radar and find good entry points when the price drops.

 


  Crypto Market Update

 

Bitcoin (BTC) is having a very bullish day after yesterday’s quiet day. Since early this morning, some traders have been taking advantage of the low liquidity to push BTC past a 49k resistance. As a result, BTC is up 5% to 50.9K.

Bitcoin Dominance (BTC.D) is flat, signaling that investors are entering all crypto spaces and not solely Bitcoin.

SushiSwap (SUSHI) is having a solid breakout from 11-month lows after news of leadership restructuring. Sushiswap is one of the most utilized DEXes in crypto and is fourth in TVL for DEXes, with $5.51 billion locked. Rumors circulate that the new director wants to modernize the swap to look like a centralized exchange. Sushiswap is accessible on 13 different chains, and inner turmoil has hurt Sushiswap price in the past six months. I would expect a strong rebound in price with SUSHI’s new sentiment. SUSHI currently sits at $7.29, far from its high in March 2021 of $23.00.

Near Protocol (NEAR) is up 26% to $13.60. Volume is entering NEAR after partnering with Terra (LUNA) on Dec 21st.

Notable Movers

ADA +8.9%

AR +7%

DOT +7%

LUNA +9.2%

MATIC +6.7%

SOL +6.9%

FTM 15.8%

Metaverse and Games Tokens are beginning to wake up.

MANA +8%

SAND +17.3%

NTVRK +14.9%

AXS 5.08%

 

Bitcoin Fear and Greed index: 41 fear

Google Trends 35

Max Pain (Dec 30 Options) 48k

How to use The Fear and Greed Index for investing

 


  Trade Set-up DOT

Polkadot (DOT) has been underperforming since Nov 5th and has dropped 56% despite Parachain Auctions and all the hype. The first five auctions are now complete, and Polkadot went live on Dec 17th after five years of research and development. Nevertheless, DOT remains one of my favorite projects, and its multi-chain architecture has the potential to play an essential role in the future of blockchain.

If the crypto market continues to climb next year, I believe DOT will be a strong performer, and right now is the time to pick it up at a highly discounted price.

I remain unconvinced that technical analysis is a good tool for predicting future prices. However, it is still a valuable tool in visualizing past price actions and patterns. Nevertheless, DOT is beginning the last leg of an Elliott Wave Pattern on the Daily Chart. The previous three days show a bullish breakout of DOT price, and the RSI is healthy at 50.

If the pattern holds and reaches the .618 fib level based on the 4th wave, we can see DOT get to $75 around late March or Early April. This period coincides with the FOMC meetings which will hold a lot of weight on how far crypto climbs in 2022. I wrote about this in a previous report.

1*vRzn1gDSb1SLRF_yywPhnw.png

I would recommend adding a stop loss in the $20–22 range in case the market continues to retreat downwards. Take profits along the way and zero out your stop loss after you’re up 20–30%

 

 

Major Crypto News

 

 

 

NEWBIES Lesson of the day

What is TVL?

TVL is an abbreviation for TOTAL VALUE LOCKED and is a metric unique to crypto. It represents the total amount of assets deposited into decentralized protocols. These could be assets utilized in liquidity mining, staking, earning interest, or used in other smart contract utilities. In crypto, the assets are typically coins or tokens of various types but extend to include NFTs.

If you view a protocol like a bank, all the money and assets currently in the bank are the TVL. Therefore, assets will continuously flow in and out of the protocol but will not move for years.

Types of crypto protocols that contain locked assets:

  • Chains
  • DEXes
  • Lender/Borrowing services
  • Yield Providers
  • Insurance
  • Options trading
  • Staking

The total TVL for the entire crypto currently sits at $256.12 billion.

To give you an idea of how fast crypto is growing, on Dec 30th, 2020, the total TVL was at $19.18 billion. The market has more than 10x the value of assets locked in protocols.

The preferred location to view TVL is Defi Llama.

Now that you understand TVL, the following Monday, I will explain how it can serve as a helpful tool in evaluating protocols and the crypto market as a whole.

 


 

Thanks for reading! Eat more, sleep more, drink more, and be merry. Have a great Christmas y Feliz Navidad para mis compadres en España.

Gabi

Follow me on Twitter and Medium or subscribe to this FREE daily newsletter on Substack

To reap the benefits of this newsletter it’s recommended to read it every day to stay in tune with crypto markets. It will put the reader in the 2% of market participates that are well informed. The reader will begin to see opportunities that are not apparent to most and will open up many more. The newsletter is composed of many hours of daily research in charts, on-chain metrics, news, and developing narratives condensed to a 5-minute update. It’s my contribution to a crypto community that has contributed so much to me.

 

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Gabi_
Gabi_

Market Research Analyst . Crypto Enthusiast. Hours of research condensed into a daily five minute report.


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