WAVES Sees Increased Investor Distribution as USDN Troubles Persist

Despite recent claims that Neutrino USD [USDN] is not inherently linked to Waves [WAVES], the recent troubles of the algorithmic crypto-collateralized stablecoin resulted in a significant drop in the token’s value.

The ecosystem confirmed in a blog post published on December 8 that the constant de-pegging of its USDN stablecoin could not increase its volatility because “USDN is a separate project built on Waves blockchain that uses WAVES as collateral” and “it is not intrinsically linked to WAVES token.” However, as the value of USDN fell, so did the value of WAVES.

In an attempt to restore investor confidence in these assets, Sasha Ivanov, the founder of the WAVES protocol, tweeted on December 20 that the USDN stablecoin would be fine and that the token would not be reduced to zero value.

However, in a later tweet, he confirmed his decision to launch a new stablecoin, which did not instill confidence in investors.

Furthermore, on December 21, Ivanov requested that several centralized exchanges, including Binance, Kraken, OKX, and Bybit, disable the token’s futures market. “They are a breeding ground for FUD and making money off short positions, profitable because of it,” says the founder.

All attempts to assuage concerns about WAVES’s potential death spiral have been futile, as many believed the token would eventually fail.

WAVES was trading at $1.50 as of this writing. The asset’s value has dropped by 58% in the last two weeks, according to CoinMarketCap.

WAVES’ analysis of a daily chart revealed that the token had been widely distributed in recent weeks. As a result, as its price fell, many holders exited the market, incurring substantial losses on their investments.

Furthermore, the token’s Money Flow Index (MFI) was 5.36 at the time of publication, indicating that it was oversold. Similarly, its Relative Strength Index (RSI) was found to be far from neutral at 27.46.

WAVES’ on-balance volume (OBV) fell by 8% in the last two weeks to 530 million at press time. When an asset’s price and OBV have lower peaks and lower troughs, the downward trend is more likely to continue. With increased negative sentiment following the token, its downtrend may continue.

Finally, WAVES’ Chaikin Money Flow (CMF) was -0.18 and was below the center line in a downtrend. In a seller-dominated market, a negative CMF is expected, and given the state of the ecosystem, a further decline should be expected.