Uniswap’s UNI governance token has been rocketing higher alongside the aggregated DeFi sector throughout the past few days, once again surmounting $3.00 as buyers aim at it seeing further upside in the mid-term.
The cryptocurrency is one of the DeFi “blue-chips” that has been seeing immense momentum as of late and is widely viewed as a benchmark for the rapidly emerging sector.
A couple of catalysts for potential UNI upside in the months ahead could be implementing version 3 of the AMM or passing a governance proposal that directs platform trading fees to the token holders.
There is another event coming up that could take some immense pressure off of the Uniswap token’s price and allow it to see significant gains.
One early-Ethereum investor – and reported “whale” – explained in a recent tweet that UNI might soon see price discovery once the farming incentives run out.
These incentives reward users who deposited liquidity into various pairs and are widely thought to have contributed some immense sell-side pressure to the cryptocurrency.
Uniswap’s UNI Rockets Past $3.00 as DeFi Sector Rallies
It has been a rough past few months for the aggregated DeFi sector, with many investors capitulating and exiting their positions in the tokens within this fragment of the market.
This capitulation caused UNI’s price to plunge from highs of $8.50 to lows of $1.90 that were set just over a week ago.
However, the market reversed earlier this week when YFI saw a massive influx of buy-side pressure that sent it rocketing from $7,500 up to highs of $18,000.
This created tailwinds that have boosted the entire sector, including UNI.
Ethereum Whale Claims UNI Will Soon Enter “Price Discovery” Mode; Here’s Why
While sharing his thoughts on the cryptocurrency, one respected investor and Ethereum “whale” stated that Uniswap’s UNI token could soon rally higher once liquidity farming incentives end in a week.
“Alpha in plain sight: in one week, the farm N dump pressure against UNI will lift. Liquidity mining stops. It will be interesting to see the price discovery then…” he said.
This imminent uptrend could be further bolstered by the growing trading volumes seen by the platform.
As volumes grow, the token’s inherent value grows in tandem due to the expectation that, eventually, platform fees will be redirected to token holders.
Until this proposal passes, however, the cryptocurrency lacks significant underlying value and is more of a speculative bet on future developments.
Featured image from Unsplash. UNIUSD price data from TradingView.