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Liquity is a small but fast-growing blockchain platform that owns LUSD.
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LUSD has managed to maintain its peg during the period of strains.
Liquity (LQTY/USD) price has been one of the top performers in the crypto industry as demand for the mid-cap token jumps. It peaked at $3.37, the highest point since March last year. This means that the coin has risen by over 460% from its lowest point this year.
Liquity price steady
Liquity is a small and fast-growing blockchain platform that provides interest-free loans on Ethereum. It does this through its Liquity USD, its stablecoin. Data compiled by CoinMarketCap shows that LUSD has maintained its peg against the US dollar.
It was trading at $1.02 while its total market cap has jumped to over $255 million. It is unclear why Liquity has done well in the past few weeks. A likely reason is a fact that LUSD is one of the top over-collateralized stablecoins.
The next key catalyst for the Liquity price will be the upcoming American inflation numbers scheduled for Tuesday. Economists believe that the data will show that the headline consumer price index (CPI) pulled back to 0.4% while core CPI came in at 0.5%. On a YoY basis, inflation is expected to come in at above 6%.
A higher-than-expected inflation figure will put more pressure on the Federal Reserve to act. Analysts believe that the Fed will hike rates by 0.25% in its meeting next week. Some believe that it will not hike rates while those from Mizuho sees the bank cutting interest rates by 0.25%.
Liquity price is also jumping as Bitcoin and Ethereum prices continue rising. Bitcoin has jumped to $24,800 while Ethereum has soared to $1,692. In all, the total market cap of all cryptocurrencies has risen to over $1.08 trillion. Cryptocurrencies tend to have a close correlation with each other.
Another reason for the LQTY rally is the news that Binance has become one of the biggest holders of the token. Data shows that it owns about 11.5 million LQTY tokens.
Liquity price prediction
The daily chart shows that the LQTY price has been in a strong uptrend in the past few days. It jumped above the key resistance point at $1.81, the highest point on June 16. It also crossed the important level at $2.85, the previous YTD high. Liquity remains above all moving averages while oscillators like the Relative Strength Index (RSI) and the Stochastic Oscillator have moved above the overbought level.
Therefore, Liquity price will likely continue rising as buyers target the next psychological level at $3.50. The stop-loss of this trade will be at $2.50.
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The decentralized finance (DeFi) space is currently set ablaze as the crypto market continues its price rally, with a unique crypto asset driving the big gains being Liquity (LQTY). The asset, which was listed at the end of May on multiple leading exchanges, such as Binance, is continuing its price rally as more and more investors pour in to increase their positions in the asset.
The Liquity protocol is designed to provide easy access to liquidity for DeFi projects. The asset carries low transaction fees and requires no collateral. This makes it an ideal way to provide liquidity to DeFi builders & developers with quick and reliable access to funds that would otherwise require significant assets and unused capital locked up in other assets.
The protocol also provides rewards to users that participate in the network. These are provided in the form of LQTY rewards, which increase gradually over time. These rewards can be earned in two ways. First, by providing liquidity to the protocol, users can earn a portion of the transaction fee as LQTY rewards. Second, users can also stake their LQTY to earn rewards for providing security and assurance to the network.
These rewards make it much easier for small investors to gain exposure to LQTY and the potential rewards it offers. With the amount of liquidity currently being generated from staked LQTY and liquidity providers, the price of LQTY has already been pushed up in the past few days, with a market cap of over $100 million as of June 3rd.
The question now is, how high can LQTY go? Currently, the asset is trading at an all-time high near $3.50. If it can continue to benefit from its unique features and rewards, the price rally may continue with some more momentum in the coming days and weeks, potentially nearing the $5 level. Of course, only time will tell if this is achievable.
Overall, the Liquity price rally is definitely gaining steam, and with more and more investors looking to capitalize on the rewards offered by the protocol, it seems as though the sky may be the limit in terms of how high the asset can go. The DeFi space is growing more competitive each day, and the future of LQTY and other projects in the space will most likely be determined by the amount of liquidity they can generate and the rewards they can offer to users.
