Stellar had a huge bullish move after the announcement of the burning of 55 billion XLM coins, half of the total supply. Naturally, the price went up really fast and XLM experienced a nice surge from $0.06745 up to $0.0887, unfortunately, this only lasted a week.
XLM saw an initial dump down to $0.068 but was able to recover back up to $0.0827 when the real crash started. XLM has been in a downtrend ever since and has seen a 7% loss just today. The volume hasn’t been significant but the bulls lost pretty much all-important support levels and the digital currency is currently in a heavy downfall.
It seems that today’s move was fueled by the transfer of 50 million XLM from the Stellar Development Foundation to Kraken, a cryptocurrency exchange.
50,000,000 #XLM (3,622,791 USD) transferred from SDF Operations to #Kraken
— Whale Alert (@whale_alert) November 17, 2019
The reactions on Twitter were mostly negative as most people see this as developers dumping their XLM coins. Although this is certainly a big transaction, it’s not necessarily as big as it seems when we take in count XLM has a current market cap of around $1.32 billion.
It’s also important to note that the SDF (Stellar Development Foundation) purpose was to help the Stellar platform achieve the global payments standard and selling those coins might be viewed as dumping but could be a necessary step.
This seems to be a similar situation as XRP with Ripple when the foundation sent large amounts of the cryptocurrency to various different organizations. Investors are usually not quite pleased with this as they don’t know what the purpose of the transactions is. Transparency is usually quite important in the cryptocurrency industry.
As previously mentioned, the bearish volume hasn’t been too significant which means not a lot of people are actually selling their XLM coins but it also seems that not many investors are willing to buy XLM back either.
The 4-hour chart has been clearly in favor of the bears but the RSI is currently overextended which means a bounce could be happening soon.
The post Stellar Keeps Crashing Hard Despite Recent 55 Billion XLM Burn appeared first on ZyCrypto.
Leave a Reply
This site uses Akismet to reduce spam. Learn how your comment data is processed.
