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Algorand [ALGO] registers an increase in TVL, but concerns still remain

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Algorand [ALGO] registers an increase in TVL, but concerns still remain
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  • Algorand’s TVL increased by 137% in the last seven days.
  • Market indicators and a few metrics looked bearish.

Algorand [ALGO] flashed in the headlines because of its latest achievement. DeFiLlama revealed that Algorand’s total value locked (TVL) registered a massive increase by growing over 137%. With this new development, Algorand was back within 18% of its previous all-time high.

Not only did the TVL increase, but as per AlgoExplorer, Algorand’s total addresses also went up in the last seven days. This too was an optimistic update, as it indicated a higher number of users in the network.

Furthermore, FLUX, one of the largest web3 decentralized computing networks, announced that its parallel asset to be deployed on its interchain operable platform will be Algorand. 

Read Algorand’s [ALGO] Price Prediction 2023-24

Is trouble around the corner?

ALGO’s performance on the price front was also optimistic over the last week, as its chart was painted green. According to CoinMarketCap, ALGO’s price registered over 12% weekly gains, and at the time of writing, it was trading at $0.2323 with a market capitalization of more than $1.6 billion.

However, the good days might come to an end, as few market indicators were bearish for ALGO. The Relative Strength Index (RSI) registered a downtick while it was in the overbought zone, which was a bearish signal. The Chaikin Money Flow (CMF) and On Balance Volume (OBV) also went down slightly, further increasing the chances of a trend reversal.

Source: TradingView

Realistic or not, here’s ALGO’s market cap in BTC’s terms

Here is what metrics suggest

Interestingly, ALGO’s popularity went down over the last week as its social dominance decreased. While popularity declined, negative sentiments toward ALGO increased, which was concerning because it indicated a lack of trust from the community in ALGO.

Despite the negatives, a few of the metrics were also in favor of ALGO, providing much-needed hope for a continued surge. For instance, ALGO was in demand in the derivatives market as its Binance funding rate remained consistently high. The development activity also increased in the last week, which is a positive signal for a network. 

Source: Santiment

 

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Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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