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Arbitrum (ARB) Token up Almost 1,000% From Bottom 24 Hours After Trading Starts

Fri, 03/24/2023 - 17:00
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Arman Shirinyan
Arbitrum token shows unexpected performance, dragging whole market with it
Arbitrum (ARB) Token up Almost 1,000% From Bottom 24 Hours After Trading Starts
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The Arbitrum token (ARB) has recently displayed incredibly strong performance on the market, with its value surging by nearly 1,000% from the local bottom observed on both centralized and decentralized exchanges.

The highest observed selling price among investors reached approximately $10, primarily due to low liquidity. Currently trading at around $1.4, ARB is experiencing extreme volatility as not all investors have claimed their airdrops yet.

Source: TradingView

The massive price surge can be attributed to several factors, including the excitement surrounding the Arbitrum network's airdrop event and the anticipation of its long-term potential. As more investors claim their airdropped tokens and engage with the network, the demand for ARB has increased significantly. This, coupled with limited liquidity on exchanges, has led to drastic price fluctuations and an overall bullish trend for the token.

Despite the strong performance, it is essential to recognize the inherent risks and uncertainties associated with investing in the ARB token, particularly given its extreme price volatility. As the market continues to react to the airdrop event and more investors claim their tokens, it is possible that the token's value may experience further fluctuations in the short term.

XRP reverses

Following an impressive 30% rally just four days ago, XRP has experienced a reversal, with numerous traders and investors closing their long positions. The primary reason behind this shift in market sentiment is likely the widespread profit-taking among market participants.

The recent XRP rally propelled the digital asset to price levels not seen in months, providing an opportunity for investors to secure profits after experiencing a prolonged downtrend and recurring losses. With the price surge, many traders were able to recoup some of their losses, leading them to close their positions to lock in gains.

As profit-taking occurs, selling pressure on XRP increases, which in turn may drive the price down and create a domino effect as more investors decide to take their profits as well. This chain reaction can lead to a short-term price reversal, as witnessed with XRP in recent days.

Additionally, the overall cryptocurrency market remains highly volatile, with external factors such as regulatory developments and macroeconomic shifts continuing to influence market sentiment. As a result, investors may be more inclined to take profits on short-term gains rather than hold their positions in anticipation of further price appreciation.

Ethereum burn rate accelerating

As Ethereum's network activity surges, the burn rate of the cryptocurrency has reached new heights, with almost 900,000 ETH now being burned annually. The increase in network activity is a direct result of the growing adoption of decentralized finance (DeFi), non-fungible tokens (NFTs) and other blockchain-based applications built on the Ethereum platform. At press time, Ethereum is trading at $1,813, following a 4.3% price increase yesterday.

Here's What Ethereum (ETH) Whales Are Doing Ahead of Airdrop of Year

The Ethereum burn rate is a critical factor in determining the market price of an asset. To understand how the burn rate affects the market price, it is essential to grasp the concept of token burning. Token burning is the process of permanently removing a certain amount of tokens from circulation, thereby reducing the overall supply of the asset. This process is intended to create scarcity, which in turn may lead to increased demand and higher prices for the remaining tokens.

Ethereum's burn rate has experienced a significant uptick due to the implementation of Ethereum Improvement Proposal (EIP) 1559, which introduced a base fee that is burned for every transaction on the network. This fee-burning mechanism helps stabilize Ethereum's fee market while also reducing the total supply of Ether in circulation.

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About the author

Arman Shirinyan is a trader, crypto enthusiast and SMM expert with more than four years of experience.

Arman strongly believes that cryptocurrencies and the blockchain will be of constant use in the future. Currently, he focuses on news, articles with deep analysis of crypto projects and technical analysis of cryptocurrency trading pairs.