SUSHI’s price fortunes haven’t been very consistent this month. In fact, while the first half of May saw the alt trade just below its ATH levels of $23.38, the last few days have seen the crypto fall sharply on the back of the market bloodbath. In the span of just 6 days, SUSHI lost over 50% of its value.
At the time of writing, all wasn’t lost, however, with some signs of recovery seen on the price charts. The same was evidenced by the crypto hiking by over 30% in 24 hours.
Alas, price movements mean less than a flash in the pan if not backed by solid fundamentals. Fortunately, in the case of SUSHI, its recovery has been supported by not just the latter, but by institutional sentiment and ecosystem-centric updates as well.
A recent report from Santiment underlined the strength of SUSHI’s on-chain metrics.
The good, bad, and ugly of SUSHI’s on-chain metrics
Consider active addresses, for instance. Despite the aforementioned market-wide depreciation, the same remained more or less on an uptrend for SUSHI. This was the case even when the weekend came, with the same highlighting the impressive interest SUSHI has been accruing.
Even when metrics did fall over the course of the weekend or following the market fall, at press time, they had recovered somewhat, with the likes of Trading Volume holding steady to support the uptick in network activity following a sharp fall a few days ago.
These findings, however, don’t mean that all is well and rosy. For example, at the time of writing, exchange inflows were still too volatile following the huge spike seen in the same a few days ago. When the market crashed and SUSHI’s value fell, many holders capitulated, with the same evidenced by “lots of people depositing tokens to exchanges to exit positions.”
What’s more, the Network Profit-Loss and MVRV metrics seemed to stress on the scale of the aforementioned capitulation too.
Corresponding to the altcoin’s loss of value, the NPL registered a very sharp dip, a dip that underlined the fact that a significant chunk of SUSHI had been moved to exchanges at a loss. Further, according to Santiment,
“SUSHI’s 30-day MVRV ratio dipped to almost -44%, indicating that all addresses that have acquired SUSHI in the past 30 days were – on average – down 44% on their initial investment.”
Sounds like bad news, right? Well, perhaps, but there is a flip side of a silver lining here, with the latter metric also suggesting that SUSHI seemed to be terribly undervalued. Ergo, when the crypto’s price sustains a bounceback, there will be quite an upside to run into, at least until the MVRV levels off.
Finally, there’s also the question of narratives. Yes, SUSHI’s price fell and yes, a lot of holders capitulated and sold off their positions. Alas, one way to look at it is that the altcoin has now shrugged off the weak hands in the market. When the upside comes, it will be driven by the stronger hands in its market.
Price performance and on-chain metrics apart, there are other reasons why it’s not out of the question to be optimistic about SUSHI’s long-term fortunes. In fact, as was highlighted by a recent article, organic developments such as the launch of Kashi lending and Margin Trading on SushiSwap’s BentoBox have the potential to fuel more upside for the crypto.
SUSHI – A tripling to come?
Finally, it would seem that institutions and crypto-asset fund managers are taking the alt seriously as well, with Arca CIO Jeff Dorman being one of them. In a recent interview with Business Insider, Dorman sought to clarify that while SUSHI has underperformed this year, that won’t be the case for long going forward.
In fact, Dorman is confident that SUSHI’s token will triple in the long term, especially since the token accrues economic value in the form of dividends to token holders.
SUSHI, therefore, might not really be a bad bet in the long term.