On-chain degeneracy rages as Bitcoin fails to deliver: Part two
|This week, I want to build on something I laid a foundation for in the last newsletter. The narrative is simple, Bitcoin price fails to deliver the volatility, so investors are going off centralized entities to on-chain to find some. The result of this is a burst in Decentralized Exchange (DEX) altcoins that rally hundreds and thousands of percentages in 24 hours.
While most of these altcoins are scams, very few make it to the mainstream attention. The frog-based crypto PEPE is one such altcoin that is listed on major centralized exchanges.
In this latest on-chain altcoin season, Coinbase’s BASE chain caught the attention of many investors as token BALD rallied 30,000x in under 48 hours.
The fact that investors cannot bridge their capital out of the Layer 2 token made it much more amusing to on-chain degenerates on the constant lookout for altcoins that make it big.
This week, however, the BASE Layer 2 chain might get a second taste of the spotlight again as the project announced the launch of an official bridge on August 9.
The launch will give investors a chance to realize their unrealized profits made on tokens such as BALD and TOSHI. Additionally, it could trigger a burst in buying pressure in anticipation of this bridge.
So, for on-chain degenerates, who do not care about the risks or if the altcoins are scams, this is a perfect opportunity.
Bitcoin price, on the other hand, continues to hover around the $29,000 level with no directional bias in the short term. But for long-term holders, the three-month chart provides a clear picture, and it suggests BTC could slide down to the $24,777 to $21,473 zone.
Moreover, short-term investors could find some respite as the U.S. Federal Reserve will be announcing the inflation numbers this week on August 10 at 12:30 GMT.
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