Native Token of the Third-Largest DEX, SushiSwap, Hits Record Highs
Native Token of the Third-Largest DEX, SushiSwap, Hits Record Highs
Image: SushiSwap official website
SushiSwap's native token, SUSHI, recently hit a new ATH, although some predictions say that this is only a beginning of a much larger rally for the coin.
- SushiSwap’s native token, SUSHI, recently recorded its brand new all-time high.
- In doing so, SUSHI surpassed its previous record, reached on February 21st.
- SushiSwap surge likely comes due to institutional interest, with a good chance to continue growing.
Ever since the DeFi sector exploded, decentralized exchanges (DEXes) started seeing massive amounts of traffic and popularity. For a long time, Uniswap used to be the top-ranking DEX, although it recently lost its first place to Curve Finance. However, another rising DEX, SushiSwap, managed to close the gap between itself and these leading platforms and become the third-largest decentralized exchange.
Recently, however, the exchange’s native token, SUSHI, started seeing a sharp increase in popularity and usage, with its price skyrocketing along the way.
Binance came under fire in September 2020 after ignoring its own guidelines and rapidly listing SUSHI, believing that the coin has major potential. After SushiSwap’s head chef dumped tokens, many proclaimed the project to be an exit scam.
To @SushiSwap community. Since there's a lot of FUD around the migration, I've taken measure to put everything to back my words & make sure the LP migrations goes as smoothly as possible. That's my main job as the creator of this whole thing.
— Chef Nomi #SushiSwap (@NomiChef) September 5, 2020
SUSHI climbs to a new all-time high
SushiSwap token price rallied on early Tuesday alongside other DeFi tokens. The coin, whose previous all-time high stood at $19.45, as reached on February 21st, managed to surpass this record by hitting $20.42. The rally came after the Asian markets opened, according to data by Messari. With the new achievement, the SUSHI price has officially grown six times this year.
However, this is likely not all that awaits SushiSwap. According to Denis Vinokourov, the head of a prime brokerage company Bequant, based in London — the DeFi price rally is likely to continue. He speculated that institutional involvement in the DeFi sector is not far away, and as institutional investors start to join the decentralized finance, a much stronger rally is to be expected.
Vinokourov expects institutions to start joining DeFi in masses due to the recent launch of DeFi-focused trusts by Grayscale. After all, Grayscale allowed institutional investors to buy Bitcoin through the company, which will be in charge of storing and managing the coins. As a result, billions-worth of BTC was purchased by this company, and another one that offers the same service — MicroStrategy.
With the support for the DeFi sector now also being available, institutional investors are more than likely to turn to altcoins from this corner of the market.
Grayscale applied for a new crypto trust for a DeFi project
Vinokourov specified that he expects institutional interest in DeFi to surge for several reasons, including the narrowing of the GBTC premium. The GBTC premium represents the gap between the implied price of the underlying Bitcoin and GBTC share price. The gap recently went negative after peaking at 35% in December 2020.
One potential reason for this is the growing competition among firms and services providing BTC-focused ETFs. Recently, the crypto industry received very encouraging news after the ETP for Polkadot (DOT) emerged, attracting institutional investors. This was a signal that institutions are ready to go for assets other than just Bitcoin and Ethereum.
Grayscale reacted quickly, and only last month, the company applied for a crypto trust for another DeFi project — Yearn Finance (YFI). This is a decentralized finance platform that operates as an aggregator service for DeFi investors by using automation to allow them ot maximize their yield farming profits.
What is next for SUSHI?
As for SushiSwap itself, the coin’s price dropped only slightly after achieving its ATH, sinking to $17. However, this drop represents only a minor fluctuation on SUSHI’s charts, and the price has already recovered half of what it lost in the last 24 hours.
Whether SUSHI will be able to surpass the new record or not remains to be seen. However, for the time being, it appears that the coin is performing rather well, as its price continues to grow and approach the $19 mark.
If SUSHI can truly attract institutional interest, then there is no telling how far the coin may skyrocket. But, it does seem like the platform behind the coin might soon start seeing a lot more activity, and perhaps a surge of its Total Value Locked (TVL), as well.
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