Uniswap: As UNI surges 14%, can it hold amid liquidity woes?

• Analysis shows that UNI has rallied as the number of active addresses and its treasury value have surged.
• Volume activity and liquidity flow have not favored the asset’s upward movement.

Uniswap [UNI] has experienced an impressive upswing over the past 24 hours, rallying by 14%, as observed on CoinMarketCap.

This surge has erased losses recorded over the past month, putting UNI back in the positive zone.

An analysis of market sentiment indicates that while on-chain activity could open the door to further rallies, the asset still faces threats, as AMBCrypto’s research suggests.

370K UNI holders and treasury boost signal strong fundamentals

Market data shows that the recent price increase may be attributed to several key on-chain developments.

One significant contributor is the Total Holder Count of UNI, which has reached a new all-time high.

At the time of writing, approximately 370,000 addresses now hold UNI. While the total volume held by these addresses isn’t specified, it is likely significant, contributing to the recent 24-hour price increase.

During this period, UNI’s Treasury Value also grew, further strengthening bullish sentiment. The treasury is now valued at $5.6 million.

This growth indicates that Uniswap’s financial health is strong and that the team has the necessary resources to support development efforts when required.

While these market developments have drawn investors closer to UNI, sentiment data also suggests the market isn’t entirely bullish.

DEX volumes fall, and TVL inches up

Market analysis reveals a notable drop in spot trading activity on Decentralized Exchanges (DEXs), as volume continues to fall.

Currently, DEX Spot Volume has declined, with only $1 billion in trading volume observed for UNI.

This persistent decrease suggests that spot traders may still be selling the asset, potentially putting downward pressure on its price.

Meanwhile, data from DeFiLlama indicates a sharp fluctuation in Uniswap’s Total Value Locked (TVL), which tracks assets deposited in the protocol.

TVL hovered around $4.847 billion at the start of June and now stands at $4.883 billion. This slight increase suggests minimal liquidity inflow over the past 10 days.

This trend indicates that investor conviction isn’t particularly strong. Rather than locking assets into liquidity pools for the long term, many may be keeping funds on Centralized Exchanges (CEXs) for quick sell-offs.

Spots sell, but derivatives traders stay bullish

Spot Market data indicates that sellers have been more dominant recently.

In the past 48 hours, UNI worth $7.93 million has been sold, with $6.48 million in sales recorded within the last 24 hours alone.

Although this has added downward pressure on the asset, derivatives market data suggests that traders on Centralized Exchanges remain bullish.

In just the past 24 hours, UNI’s Funding Rate has risen notably to 0.0044%, indicating that long-position holders are paying a premium in anticipation of further rallies.

Overall, market sentiment reveals that long traders are countering the selling pressure from the Spot Market, sustaining a generally bullish outlook.