Key Takeaways:
- DeFi lender MakerDAO recently announced its token buyback program.
- The platform’s native token, MKR, has steadily gained in July.
- The lending platform’s recent roadmap announcement could also have helped MKR’s price rally.
NEW DELHI (CoinChapter.com) — DeFi lender MakerDAO’s native token MKR price has made significant gains in July. The recent rally extended the token’s gains in 2023 to 122% from January 1’s low of $506.8.
MKR price spiked by over 12.5% on July 25 to reach a daily high near $1,195 before correcting. The bears seem to be defending the $1,200 price level aggressively, rebuffing any attempts by the MakerDAO token price to move above it.
At the same time, bulls are trying to ensure that MKR price continues to consolidate above the $1,050 support level. If the immediate support level fails, MKR price might test the 20-day EMA (red wave) and 50-day EMA (purple wave) support zone near $920 before recovering.
On the other hand, if the rally continues, the MakerDAO token price might rally to the resistance near $1,183. Breaking and consolidating above the immediate resistance level could infuse confidence in the token’s rally. As a result, MKR price might target a price label close to $1,311 before correcting.
The RSI for MKR entered the overbought region, clocking at 70.68 on the daily timeframe. Hence, it is likely that MKR price might continue to crab before attempting to rally again.
MakerDAO’s Roadmap Includes AI
MakerDAO, the firm behind the Dai stablecoin and MKR, announced a slew of planned updates in May, beginning with an upgrade to unify the firm’s brand. The DeFi lender also shared a roadmap detailing a five-phase project called “Endgame.“
The announcement noted that the firm would eventually launch six “Maker subDAOs” split between facilitator and allocator DAOs. The subDAOs would aim to streamline the organization’s workload.
Moreover, MakerDAO stated that it plans to add new tokens, with updated features, to its stable. A key aspect of the roadmap included plans to launch several internal AI tools. The firm would also provide funding for open-source AI projects.
Artificial Intelligence has become a key focus among tech and crypto firms. The decision to enter the AI sector might have helped attract buyers to the market.
Token Buyback Also Helped MKR Price Rally
MKR prices briefly rallied to a 13-month high on July 21 when the MakerDAO token rose to a daily high near $1,250 before correcting. The token likely reacted to news of MakerDAO introducing a token buyback program.
Dubbed the “Smart Burn Engine,” the program would allocate excess DAI stablecoins from MakerDAO’s ‘Surplus Buffer‘ to purchase MKR tokens from a UniSwap pool.
The blockchain-based lending firm deployed the program on July 16, and it went live on July 19 after the Surplus Buffer exceeded $50 million. On July 21, the platform bought back nearly $230,000 of MKR tokens in 24 hours, setting it up to remove nearly $7 million worth of tokens from circulation in a month.
MakerDAO launched the Spark Protocol in May this year with the goal of bolstering DAI’s capabilities. The new platform would allow users to borrow or supply Ether, stETH, DAI, and savings DAI (sDAI).
Savings DAI, or sDAI, is a new token representing DAI deposited in MakerDAO’s DAI Saving Rate (DSR) module. The MakerDAO governance is currently voting to decide on changes in Spark Protocol’s debt ceiling.
The lending platform claims the changes would enhance users’ experience on Spark Protocol, as the increased debt ceiling would streamline new users’ onboarding experience, or so the proposal claims.
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