Composite (COMP) has recently surged with an astounding 113% rally in just two weeks, and the reason behind the rally has been the crypto community’s talk. DeFi is owned by Ignas, a decentralized finance (DeFi) researcher. Analyze it Recent developments surrounding the complex have provided insight into potential factors contributing to the increase.
Compound takes the lead with triple-digit growth in June
This remarkable growth has been driven by a combination of factors, including the recent announcement of the launch of Superstate Funds by the founder of Compound, which aims to connect traditional markets to blockchain ecosystems.
One of the main challenges facing DeFi is the lack of integration with traditional financial markets. While the DeFi space has grown rapidly over the past few years, it is still relatively small compared to the traditional financial system.
By bridging these two worlds, Superstate can help bring more institutional investors into the DeFi space and increase the overall liquidity and stability of DeFi protocols.
Moreover, Superstate’s focus on creating regulated financial products could help address some of the regulatory concerns that have been raised regarding DeFi. While DeFi protocols are decentralized and run on blockchain networks, they are still under the jurisdiction of various regulators.
By creating regulated financial products that comply with existing regulations, Superstate can help mitigate some of the risks associated with DeFi and pave the way for widespread adoption of these protocols.
Superstate aims to bridge traditional markets with blockchain ecosystems by purchasing short-term government debt and tokenizing it on the blockchain. While it is unclear whether the token will include COMP holders or result in an airdrop, this announcement has sparked excitement and speculation among the crypto community.
Jumping on the crypto whale responsible for the corporate rally?
While new governance proposals have been made, none have been significant enough to explain the sudden price increase. However, there has been a significant change in the balance between the various Jump Crypto wallets.
Jump Crypto Wallets is a group of cryptocurrency wallets associated with Jump Trading, a Chicago-based trading firm that specializes in high-frequency trading strategies. Wallets have been identified as important players in the cryptocurrency market, particularly in the DeFi space, as they have been involved in making the market and providing liquidity.
These wallets have emerged as major players in the COMP market. One of these wallets holds multiple COMP tokens and has been involved in significant balance changes, including the recent withdrawal of 170,000 COMP tokens from Binance. This drawdown amounts to $9.7 million and represents 1.7% of the company’s total supply.
The actions of this particular portfolio seem to be the main reason for the recent hike in COMP’s price. The withdrawal of such a large amount of tokens from Binance greatly increased the demand for COMP, driving up its price. As a result, this wallet now ranks as the 9th largest holder of COMP tokens.
The Compound’s native token, COMP, is trading at $58, following its bullish trend that started on June 16. In the past 24 hours, COMP continued to gain 14% and is currently trying to break the $60 level to surpass its yearly high of $64 achieved in February.
Featured image from Unsplash, chart from TradingView.com