The market is experiencing an all-out bullish sentiment as the broader crypto industry rallies. According to Coingecko, the market is up nearly 4% today as Bitcoin and Ethereum bulls flex their muscles in favorable market conditions. This gave the altcoins a leg-up in the past few days. Stacks (STX) is one of those altcoins.
The latest market data shows that the token, up 2% in the last day at $0.85, is bringing investors some good cheers in the run-up to Christmas with a 26% increase in price in the last week. This came after the bullish news surrounding the project.
On-Chain News Boost Stacks
Several announcements contributed to STX’s current rally. Bitflow Finance recently announced the launch of its decentralized exchange on STX. This brings a new avenue for investors new to Ordinals a safe way to enter. In an interview at a recent Stacks event, Biflow CEO @dylan.btc said that the Nakamoto upgrade on the platform brought faster transaction times for users.
🚀Exciting news! sBTC Swaps are now live on Bitflow Testnet! 🌊🎉
🟠Ready activate the Bitcoin economy with @Stacks‘ sBTC and dive into the world of decentralized Bitcoin swaps?
Learn more👇 pic.twitter.com/tJWRQFYPUN
— BitFlow 🌊 DeFi (@Bitflow_Finance) November 28, 2023
Another Decentralized Finance App successfully integrated sBTC on testnet 🧡
🟧 Bitflow CEO @StacksDeveloper on why he is building with sBTC
Check out @Bitflow_Finance down below 👇 pic.twitter.com/U3jCOMLn6h
— stacks.btc (@Stacks) November 29, 2023
A simplified case where Layer-1 BTC is used as collateral for xUSD loans shows:
✅ Bitcoin is used for settlement more than for payment (both if default or liquidation occur)
✅ Payment value is unlocked by experimenting at higher layers (this is 1 exp that happens to use xUSD) pic.twitter.com/4SMLz4jot1
— dylan.btc 🧙🏻♂️ (@StacksDeveloper) May 18, 2021
But Stacks still faces a transaction speed problem.
“But the biggest complaint that we have with our users right now is slow transaction times compared to Ethereum using WBTC. So if we can get a solution that settles Bitcoin with Bitcoin security, I think that’s huge,” the CEO added.
STXUSD currently trading at $0.8616 on the daily chart: TradingView.com
Adding fuel to the hype flame is the latest Bitcoin rally after news of a positive outcome of the US Securities and Exchange Commission’s spot Bitcoin ETF decision came to light. Since the announcement, the face of crypto broke the $40k barrier and is up more than 4% in the weekly timeframe.
Crucial Breakthroughs Give Bulls Strength
The current wave of bullish sentiment is held on top of the $0.8003 support level. However, the recent price action is unsustainable with a potential downside toward the $0.7007 support level. A drop to this level will hurt present gains but will give STX bulls a solid foundation to reclaim lost upward momentum shortly.
STX price action in the last week. Source: Coingecko
But even if the bulls currently have enough strength to push through the $0.8680 price ceiling, the momentum is subject to Bitcoin’s price movements. This makes it susceptible to more pain if BTC suffers downward pressure. In the meantime, investors and traders should exercise caution on this recent rally.
However, given the year-to-date performance of STX, investors and traders should consider the token for the long term. If profit is to be found, exiting at the token’s current price point will be enough.
(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).
Featured image from Shuttetstock