Like the rest of the market, if the market crashes, then the token will also fall, just less than other tokens. However, what makes them stand out is the strong rebound, which can often make traders 10%+ in a day, providing excellent opportunities for traders.
Additionally, the price volatility of these tokens is great for traders, providing instant gratification. Don’t you love assets that go up after you buy at the bottom (support line)? Don’t you love assets that have a clear bottom, but may not have one?
1、Arbitration (ARB)
Arbitrum, the leading L2 on Ethereum, is a young token called ARB, which was launched less than a year ago (March 2023). Since ARB was launched in a bear market, it has yet to see its “skyrocketing moment”.
If you look closely at the chart below, it’s easy to see how this token is different from the others. Overall, ARB has not had a great year. But compared to most tokens that have plunged 90% since the peak of the 2021 bull run, ARB’s price chart is far less pathetic.
This year, ARB has experienced several rallies with little to no fundamental reason behind them, most recently during the ETHCC event amid rumors of some big announcement (which ultimately proved underwhelming).
In addition to some technical analysis predictions, I have some theories behind these rallies.
ARB still has a long way to go before investor tokens are unlocked. According to DeFillama data, the first unlock of ARB will begin in 200 days, on March 22, 2024.
Therefore, there has been no major sell-off of ARB since the token launch, coupled with the assumption that most people who received ARB through the airdrop have sold it, which has caused some volatility and created some profit space for traders.
As the token unlocking time approaches, we can be sure that the ARB price will drop. But I have been in the cryptocurrency market long enough to know that the token price will rise before unlocking. I know this is a strange logic, but if you understand the game theory of the cryptocurrency market, you will know that investors will never sell their tokens cheaply. The rebound "helps" create FOMO and bring liquidity to these investors' massive sell-offs. Although this theory is just an urban legend, it still makes sense when you think about it.
Fundamentally, Arbitrum has managed to solidify itself as one of the successful projects even during the bear market. It has found a niche, being the No.1 DeFi L2. Moreover, GMX built on top of it has become a "mascot" protocol that can attract new users and thus increase fee income.
In summary, the combination of token status + fundamental value makes ARB a good volatility asset.
2、Optisium (OP)
At the time of writing, OP is going through its token unlocking period and the price has seen some volatility.
Recent volatility in OP, the native token of another leading Ethereum L2 Optimism, is an example of how tokens can rise ahead of unlocking events.
In two months, OP rose from $0.89 to $1.8. In the recent memecoin boom, OP was also one of the relatively "booming" tokens, rising together with tokens such as BALD or UNIBOT.
The reason for the rise (excluding any market irrationality) is the recent rise in Optimism’s reputation. Coinbase built their Base chain on top of Optimism’s OP Stack and entered into a revenue sharing agreement that was beneficial to both teams. Not to mention, the launch of OP Stack and the OP Stack chain ecosystem itself during the ETHCC event also contributed to the market’s excitement about the asset and the rise in price.
The establishment of the partnership between Coinbase and Optimism proves Optimism's position as a top L2, challenging Arbitrum.
My personal experience trading OP is that there is no lack of demand for this particular token. On the dips, the reversal always happens quickly and quite violently. On Binance, OP has a decent volume and is one of the most traded tokens, with even more volume for its perpetual contract.
End of the article
August has been one of the most hated months in the crypto market in years. Now that August is over, what’s next? Things don’t stay at the bottom or the top forever.
Usually, the end of the year is a good time to start accumulating positions. That’s why I’m sure it’s a good idea to share these coins. Because when the big market comes, the coins that rebound the fastest are the strong coins.
Later, I will bring you analysis of leading projects in other tracks. If you are interested, you can click to follow. I will also organize some cutting-edge consulting and project reviews from time to time. Welcome all like-minded people in the cryptocurrency circle to explore together. If you have any questions, you can comment or send a private message