MakerDAO's MKR Approaches 16-Month Peak Amidst Whale Accumulation; Crypto Hedge Fund Sets Optimistic Price Projection
Ouroboros Capital, a cryptocurrency hedge fund, has put forward the notion that the MKR token could potentially attain the $1,600 price threshold, driven by the escalating profits within the protocol.
Maker (MKR), the governance token of the decentralized finance (DeFi) lender MakerDAO, is on the verge of reaching its highest valuation since May of the previous year. This upswing is attributed to the mounting profits within the protocol and the accumulation of MKR by notable investors.
In the past 24 hours alone, the cryptocurrency has witnessed a surge of nearly 5%, soaring to $1,320, approaching its zenith in early August at $1,366, as indicated by data from Bitsday. If this level is surpassed, it would signify a 16-month pinnacle.
Throughout the current year, MKR has displayed substantial outperformance in comparison to the broader cryptocurrency market, boasting an impressive return of 152%. By contrast, Bitcoin (BTC) has experienced a 64% upturn during the same period, while the Bitsday DeFi Index (BCF), which tracks a curated selection of DeFi tokens, has seen a modest rise of under 10%.
The surge in MKR's valuation aligns with MakerDAO's strategic maneuver to allocate a significant portion of its reserve assets into U.S. Treasuries, capitalizing on the lucrative yields offered by traditional bond markets.
Since the onset of the year, the protocol's annual revenue has quadrupled, reaching an impressive $185 million. Estimated annual profits have surged from $39 million to $58 million, as reported by the Makerburn dashboard. Moreover, MakerDAO introduced a 5% incentive reward for DAI last month, stimulating demand for the stablecoin. Consequently, the supply has augmented by a substantial $1 billion since early August.
It is worth noting that two major cryptocurrency investors, commonly referred to as "whales," have been accumulating MKR over the course of this month, as highlighted by blockchain analysts at Lookonchain. This signifies a favorable shift in sentiment towards the cryptocurrency. One entity procured a total of $1.95 million worth of MKR starting on September 4th, while another whale acquired $1.63 million worth of the token just this week.
Ouroboros Capital, the cryptocurrency hedge fund, holds the anticipation that the upward surge in price is likely to persist, attributable to the escalating supply of DAI and the mounting revenues. They also point to a bullish technical chart pattern, indicating a potential price target of $1,600.
In a post on the social media platform X (formerly Twitter), the hedge fund voiced their stance, affirming:
"A promising cup and handle pattern is forming in MKR. We remain of the view that it will test $1.6K."
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