Can LDO pivot finally now that Lido staking deposits are recovering?

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  • Lido Finance expe­ri­enced a drop in the pop­u­lar­i­ty of its stak­ing plat­form in November.
  • How­ev­er, LDO’s mon­ey flow did reg­is­ter some upside in the last few days despite the downside.

LDO fans are in for a treat fol­low­ing Lido Finance’s lat­est ana­lyt­ics update. The stak­ing plat­form revealed that it observed an increase in stak­ing deposits on mul­ti­ple chains that sup­port its operations.


Read Lido DAO’s [LDO] Price Pre­dic­tion 2023–2024


Lido Finance expe­ri­enced a drop in the pop­u­lar­i­ty of its stak­ing plat­form in Novem­ber dur­ing and after the FTX collapse.

Its LDO token sub­se­quent­ly faced less demand and as a result, saw more down­side. The num­ber of active address­es hold­ing the token sub­se­quent­ly dropped from the sec­ond week of Novem­ber to the end of the month. Sim­i­lar­ly, the sup­ply of the top 1% of address­es reg­is­tered sig­nif­i­cant outflows.

Lido active addresses and supply held by top 1% addresses

Source: Glassnode

At press time, active address­es were still low but the sup­ply held by the top 1% of address­es did reg­is­ter a slight uptick. This was not the only upside reg­is­tered in the last few days. Lido’s lat­est data revealed that stak­ing deposits were up sig­nif­i­cant­ly since the end of November.

You might ask, why are these obser­va­tions impor­tant? Well, because a return of investors’ inter­est means the stak­ing plat­form can now get back onto the fast lane.

This could the­o­ret­i­cal­ly trans­late to more demand for the LDO token. The lat­ter has been on a strong down­trend since mid-August and is yet to deliv­er a siz­able recov­ery after its bear­ish per­for­mance in November.

LDO’s $1.05 press time rep­re­sent­ed a 12% retrace­ment in the last five days. This means it has con­tin­ued to seek more down­side despite the fact that demand for Lido stak­ing is recovering.

Lido LDO price action

Source: Trad­ingView

LDO’s mon­ey flow did reg­is­ter some upside in the last few days despite the down­side. This might be an indi­ca­tion of demand recov­ery and accu­mu­la­tion. Enough accu­mu­la­tion will even­tu­al­ly lead to a bull­ish piv­ot and that may hap­pen any time from now.

The expec­ta­tions of a bull­ish piv­ot are fur­ther sup­port­ed by a slight uptick in LDO’s weight­ed sen­ti­ment. This indi­cates that the num­ber of ana­lysts and traders with a bull­ish bias/expectation have increased.

Lido LDO weighted sentiment

Source: San­ti­ment

Nev­er­the­less, this upside is min­i­mal, hence not an indi­ca­tion of a strong incom­ing bull­ish wave. One poten­tial rea­son for this is that Lido’s net­work growth is still low despite the bull­ish signs and the resur­gence of demand for Lido staking.

Lido network growth

Source: San­ti­ment

Nev­er­the­less, the net­work growth met­ric has been hov­er­ing with­in the same bot­tom range since the end of November.

Judg­ing by the above obser­va­tions, the increas­ing demand for Lido stak­ing is a pos­i­tive sign for LDO’s per­for­mance for the remain­der of 2022. LDO still has the poten­tial for an end-of-year ral­ly espe­cial­ly if the rest of the mar­ket adopts a favor­able sentiment.



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