Market Signal 13th August 2024: Crypto Market on Edge Awaiting CPI Release

Update 13 Aug 2024 • Reading Time 3 Minute

Reading Time: 3 minutes

After a steep downturn, the crypto market has shown signs of recovery in the past week. Nevertheless, BTC and many altcoins haven’t fully regained their lost ground. The upcoming release of the Consumer Price Index (CPI) on August 14, 2024, is expected to be a major market mover.

The July CPI data will be crucial to the Federal Reserve’s decision to cut interest rates. If the CPI data doesn’t reveal a significant uptick, market participants expect the Fed to reduce interest rates at its September meeting. This could inject more liquidity into the market, which could help lift prices of BTC and altcoins.

The Pintu Academy team has compiled valuable insights from several crypto projects. We analyze that information to determine its potential impact on various asset prices. Will these be bullish or bearish catalysts? Find out in the following article.

It should be noted that all information in this Market Signal is intended for educational purposes, not as financial advice. Do your own research before making any financial decisions

MakerDAO (MKR) ➡️ Bullish 🚀

MakerDAO could be one of the tokens experiencing a bullish trend this week. MakerDAO’s price increase is expected to be driven by the launch of its Real World Asset (RWA) tokenization initiative, the Spark Tokenization Grand Prix.

This program, aimed at onboarding $1 billion worth of RWA tokenization, was launched on August 12, 2024. Major players in the RWA sector, such as BlackRock, through its partners Securitize, Ondo Finance, Paxos, and Superstate, are reportedly participating in this initiative.

The Spark Tokenization Grand Prix is part of MakerDAO’s Endgame Plan. In this plan, MakerDAO aims to improve the governance and tokenomics of the Maker ecosystem to reach a sustainable equilibrium known as the Endgame State. The MakerDAO ecosystem is expected to become more resilient at this stage, and its complexity will cease to change.

If this program successfully attracts funds and drives the onboarding of RWA tokenization, it will positively impact both the RWA sector and MakerDAO. Spark is expected to strengthen MakerDAO’s fundamentals. As a result, the price of the MKR token is also expected to rise.

Ethena (ENA) ➡️ Uncertain⚖️

Ethena Labs has announced the integration of USDe with Solana. Users can now sell and buy USDe through the Solana network through this integration. Now, Ethena Labs is also exploring using SOL as collateral for USDe loans. Meanwhile, the proposal and voting process related to the plan will begin this week.

The integration is believed to increase the adoption rate of USDe and sUSDe, along with the presence of new market shares on the Solana network. Also, the presence of the Solana network can provide an additional $2-$3 billion worth of open interest in the Solana futures market. All of this is expected to make USDe grow bigger.

SOL as a backing asset for USDe will be proposed to governance for implementation next week and opens up an extra $2-3bn of open interest across major exchanges, improving USDe's scalability even further pic.twitter.com/NJ4hlJ9dCv
— Ethena Labs (@ethena_labs) August 7, 2024

Despite the positive news, ENA token prices tend to fall into the uncertain category. This is because the sentiment may be already priced-in at the current ENA price.

Frax Finance (FXS) ➡️ Uncertain⚖️

Frax Finance is reportedly on the verge of launching frxBTC as a competitor to WBTC. Frax Finance founder Sam Kazemian hinted in a tweet that frxBTC would offer low slippage and provide a low-cost swap method from native BTC to USD on the Ethereum network.

Cuitan Sam Kazemian’s tweet about frxBTC’s launch. Source: Sam Kazemian X

However, beyond the founder’s tweet, no further documentation exists regarding these plans. As a result, the news remains speculative. If Frax Finance makes an official announcement in the near future, it would be positive news that could boost the price of FXS. But if there is no news, the speculation will fade away without impacting the price of FXS. Therefore, this token falls into the category of being uncertain.

The Sandbox (SAND) ➡️ Uncertain⚖️

The SAND token price is likely to experience volatility this week. The catalyst driving this price movement is the scheduled SAND token unlock. The GameFi and Metaverse protocol unlocks 205.59 million SAND tokens, representing 9% of its total supply, to investors and the core team.

With the current price of SAND at $0.26, the value of the unlocked tokens is equivalent to $53.6 million. As a result of unlocking the token, an increase in SAND supply may cause its price to decrease, especially if the rise in supply is not met with an increase in demand.