ZORA records an impressive 931% growth in one month but lacks large on-chain transactions, suspected of being manipulated by funds on centralized exchanges.
ZORA currently has a circulation rate of 35% and will unlock Tokens for investors and the team from October 2024. The 24-hour contract trading volume on Binance far exceeds spot trading on Coinbase.
- ZORA price increases up to 931% within 30 days.
- Contract volume is 16.4 times larger than spot trading, demonstrating heat in the derivative market.
- Tokens will be unlocked from October 2024, potentially diluting the market.
What does ZORA's strong price increase in one month mean?
ZORA's 931% growth in one month shows significant investor attraction, however, the possibility of non-transparent market activity is very high. Chain analyst Ai Yi notes that this volatility is likely not based entirely on natural transactions but manipulated by funds on centralized exchanges.
This is demonstrated by the absence of large on-chain transactions over 500,000 USD, despite the price surge. Dependence on centralized exchanges is reinforced by large trading volumes on Binance and Coinbase.
Such rapid growth with a lack of large on-chain transactions is usually a sign of buying pressure from large investment funds on centralized exchanges, not from a natural community.
Ai Yi, Chain Analyst, 27/7/2024
From a professional perspective, caution is needed because this phenomenon can lead to abnormal price fluctuations and risks for individual investors due to lack of transaction transparency.
How is ZORA's trading volume on centralized exchanges?
Binance currently leads with a contract trading volume of 1.354 billion USD in 24 hours, 16.4 times higher than the spot trading volume of 82.6 million USD on Coinbase – the leading exchange for ZORA spot trading. Data updated by Ai Yi shows the ZORA derivative market is very active.
This reflects the trend of investors focusing on derivative instruments to take advantage of rapid price fluctuations or hedge risks, while also creating significant pressure on market liquidity and prices.
High derivative trading volume indicates strong interest from professional traders, creating significant pressure on ZORA's actual price movements.
Cryptocurrency Market Analysis, Q2/2024 Report
How do ZORA's circulation rate and Token unlocking time affect the market?
ZORA's circulation rate is currently at 35%, relatively low compared to many other Tokens in the market. According to the plan, a number of Tokens for investors, team, and treasury will be unlocked from October 2024, potentially diluting the market supply.
This could lead to price fluctuations when new Tokens are released for sale, reducing long-term price increase pressure if there is not enough demand to support it.
Who is the market maker for ZORA?
GSR Markets is identified as the primary market maker for ZORA, playing a crucial role in providing liquidity and maintaining stable trading on exchanges. The participation of a reputable market maker helps enhance price stability and minimize liquidity risks.
Investment and management by companies like GSR Markets also demonstrate market strength for ZORA as the Token grows rapidly in a short time.
Frequently Asked Questions
Is ZORA's rapid price increase due to natural transaction sources?
Based on on-chain analysis, most large transactions are not displayed, indicating that the main driving force likely comes from large funds on centralized exchanges, not natural sources.
When will ZORA Tokens be unlocked and how will this affect the market?
Tokens are expected to be unlocked from October 2024; this may cause supply dilution, creating downward pressure on price if there is no corresponding demand.
Who is GSR Markets and what is their role with ZORA?
GSR Markets is a reputable market maker that helps maintain liquidity and price stability for ZORA on major trading exchanges.
Does ZORA have sustainable growth potential?
Due to potential Token manipulation and dilution, ZORA has high risks; investors should carefully evaluate before deciding to hold.
