Jito price drops despite $24M spot buying – Are JTO bears at risk?

There’s been a growing divergence between Jito’s [JTO] price and spot market activity, according to data from CoinGlass. While the market is accumulating, JTO has been declining. This week alone, the asset has lost roughly 9.69% as of writing.

Even on-chain, the token has continued to perform decently, with more investors committing funds to the asset as they lock in profits. Moreover, currently, JTO appears to be undervalued.

Spot accumulation amid decline

The spot market shows that over the past four days, there has consistently been more buying of JTO than selling, suggesting that demand has surged.

The netflow, which calculates the difference between inflows (distribution) and outflows (accumulation) across exchanges, shows a reading of $2.02 million over this period, with total buying amounting to roughly $24.72 million.

When accumulation persists over several days, it often implies that investors maintain a bullish outlook, particularly in the near term, as they anticipate that the asset will eventually outperform.

The single largest accumulation came on the 25th of August and accounted for the majority of the netflow. In fact, that day, the price declined 15.13% between the high and low of the candle, according to data from TradingView.

Notably, continued accumulation as the price declines could indicate that investors view the drop as an opportunity to buy at a discounted price.

On-chain capital is expanding

There has been a growing expansion in on-chain capital at the time of writing. Total Value Locked (TVL), which remains a key metric for tracking this capital, has surged significantly.

DeFiLlama reported that from the 19th of August, TVL has grown by $243.81 million, with the nine-day increase bringing the total to roughly $1.017 billion, at press time.

TVL measures the amount of capital deposited in a protocol to earn yield, and it is often linked to users’ expectations that the underlying asset or protocol will perform well over time.

In fact, the fees generated on the protocol had also increased, with the latest figure standing at roughly $504,000, the highest level since the 11th of May.

This surge indicates that investors have not only been committing funds to the exchange, but activity on the protocol has also increased at the same time.

Funding Rate could be a threat

There has been a growing number of short positions building up in the market, according to data from CoinGlass.

This insight comes from the funding rate, which tracks whether long or short positions dominate across exchanges. The rate dropped from 0.0143% to 0.0060% at the time of writing.

A decline of this scale implies that more short positions are being opened. If this trend continues and funding eventually flips into negative territory, it could place JTO at further risk of decline. For now, the market appears to be in an accumulation phase.

Final Summary

• Spot investors bought roughly $24.72 million worth of JTO over four days, pushing netflow to $2.02 million.
• Despite JTO’s price decline, rising TVL and sustained accumulation suggest investors are positioning for a potential recovery.