- MKR whales have reduced their transaction activity in the last week.
- This has put downward pressure on MKR’s value.
MakerDAO’s native token MKR has seen a notable decline in large transactions since the beginning of August. This has occurred despite the jump in the token’s value last month, on-chain data from IntotheBlock revealed.
Source: IntoTheBlock
Realistic or not, here’s MKR’s market cap in BTC terms
This metric track on-chain transactions where more than $100,000 was transferred. Institutional investors and whales often execute these transactions, and their trades can often move the price of an asset.
According to data from IntoTheBlock, the count of large MKR transactions completed daily has dropped by 81% since 1 August. As of 8 August, only 14 large transactions were completed. Meanwhile, at the beginning of the month, 75 of these transactions were executed.
The whales have shaken up the MKR market
Trading at $1,203 at press time, MKR’s value rallied by 29% in the last month, data from CoinMarketCap showed. The price of the altcoin has fallen by 10% in the past seven days, as whales have reduced their MKR transactions.
Source: CoinMarketCap
The corresponding drop in MKR’s value due to a decline in whale activity was not surprising. The activity of this cohort of investors often informs the direction of an asset’s price. When they reduce their trading activity, retail traders often view it as a sign of a looming negative price correction and react accordingly.
Also, whales provide liquidity to the market by buying and selling large amounts of assets. When they reduce their trading activity, it often leads to decreased liquidity, which can make it more difficult to buy and sell assets, putting downward pressure on the prices of these assets.
How much are 1,10,100 MKRs worth today
In addition, since the daily count of MKR large transactions began its descent when August started, the daily ratio of the token’s on-chain transaction volume in profit to loss has also plummeted. Per data from Santiment, this has fallen from 2.48 at the beginning of the month to 0.957 at press time.
Source: Santiment
This meant that for every transaction completed on 1 August that returned losses, 2.48 transactions came back with gains. However, at its current ratio, for every 1000 MKR tokens that were moved on-chain in profit, 957 were moved in loss. This indicates more selling pressure on the altcoin than buying pressure.
