- The staking rewards for ApeCoin declined significantly
- The interest in the APE token decreased, and NFTs associated with the token were impacted as well
The announcement of staking rewards for ApeCoin [APE] generated a lot of interest. There was an upsurge in buying the token itself, along with its associated NFTs. However, a few days after the announcement, the interest in APE faded away.
Read ApeCoin’s [APE] Price Prediction 2023-2024
One reason for the declining interest in APE could be the declining rewards being generated from staking pools.
According to data provided by Dune Analytics, the rewards being given out to stakeholders dropped significantly.
According to DEX data, APE was dumped heavily since 11 December. Even though the immense amount of selling had stopped, the spike in buying wasn’t enough to restore much confidence in the token.
It wasn’t just the token that was impacted. NFT collections associated with ApeCoin, such as Bored Ape Yacht Club (BAYC) and Mutant Ape Yacht Club (MAYC) were also affected.
One area that was affected was the average floor price of the BAYC collection. As evidenced by the chart below, the floor price declined by 4.85% during the last seven days. The average price at which an NFT was being sold also decreased by 2.37% during the same period.
The MAYC collection was affected in this sector as well. Its floor price had depreciated by 3.7% and its average price had declined by 2.19% over the last seven days, according to NFTGO.
The on-chain metrics of ApeCoin
ApeCoin looked glum, even in terms of on-chain metrics.
Its daily active addresses declined, signaling the fact that activity on the ApeCoin network had decreased. In a similar fashion, its network growth also fell. A shrinking network growth implied that the number of new users transferring APE for the first time dropped materially.
However, APE’s velocity witnessed a spike, which indicated that the number of new addresses transferring APE had waned.
These factors contributed to the declining price of APE. Due to the decline in prices, the Market Value to Realized Value (MVRV) ratio also fell. A low MVRV ratio suggested that if most holders sold, they would do so at a loss.
However, the long/short difference of APE rose. This implied that old HODLers who have had the token for a longer period could still make a profit if they sold their tokens.
It remains to be determined whether long-term APE holders would succumb to the selling pressure or whether they would ride out the storm.