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Top Binance Trader Optimistic About Ethereum Due to 2 Technical Trends

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  • Ethereum is primed to move even higher according to a top trader on Binance.
  • He cites two technical trends: a falling wedge and ETH’s ability to maintain the low-$300s and high-$200s.

Ethereum Poised to Surge To Fresh High: Leading Binance Trader

Ethereum has undergone a strong retracement since its year-to-date highs near $490. The leading cryptocurrency currently trades for $345, far below those highs due to a strong correction in the price of Bitcoin. ETH is strongly underperforming BTC because the altcoin acts as a high beta version of Bitcoin.

Logan Han, a leading trader on Binance, is optimistic about Ethereum’s prospects, though.

He recently shared the chart below, suggesting that the leading cryptocurrency is on track to hit a new all-time high in the coming months and years.

As to why he thinks this is the case, his chart shared two key distinct technical events:

  • Ethereum has formed a falling wedge pattern from the year-to-date highs. A falling wedge is a textbook bullish pattern often seen before a breakout to the upside.
  • ETH managed to hold the low-$300s and high-$200s.

Chart of ETH's price action over the past few years with analysis by crypto trader and leading Binance analyst Logan Han (@loganhan_ on Twitter). 
Chart from TradingView.com

Following BTC’s Path

Ethereum is likely only to reach a new all-time high if Bitcoin does so, though. Fortunately for bulls, the leading cryptocurrency is primed to move higher.

Raoul Pal, CEO of Real Vision and a former head of hedge fund sales at Goldman Sachs, recently said that BTC is likely to move much higher than it is now due to monetary policy trends:

“Most people don’t understand the latter but is simply put, Powell has shown that there is ZERO tolerance for deflation so they will do ANYTHING to stop it, and that is good for the two hardest assets – Gold and Bitcoin. Powell WANTS inflation. I don’t think he gets true demand push inflation but he will get fiat devaluation, in conjunction with the other central banks all on the same mission.”

Featured image from Shutterstock
Price tags: ethusd, ethbtc, eth 
Charts from TradingView.com
Top Binance Trader Optimistic About Ethereum Due to 2 Technical Trends





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Ethereum

Price analysis 11/27: BTC, ETH, XRP, BCH, LINK, LTC, ADA, DOT, XLM, BNB

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Bitcoin’s recent correction is healthy, but several altcoins have lost momentum and could remain range-bound for a few days.



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Compound liquidator makes $4M as oracles post inflated Dai price

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The crypto market suffered a powerful crash on Thursday morning UTC, which sent prices of major currencies like Bitcoin (BTC) and Ether (ETH) tumbling in excess of 10%.

When traders rush for the exits, the price of stablecoins generally increase as the demand for stability rises. In today’s crash, however, the effect became particularly pronounced on Dai (DAI), which briefly traded for $1.3 between 7 and 8 AM UTC.

Dai/USD price on Coinbase, courtesy of TradingView

Most notably, DAI traded at this inflated valuation only on Coinbase and Uniswap, while other exchanges including Kraken and Bitfinex seem to have maintained a relatively stable price.

Dai/USD price on Bitfinex, courtesy of TradingView

Coinbase and Uniswap are the two exchanges used by Compound’s Open Price Feed oracle. The former acts as the baseline, while the latter is used as a sanity check and anchor. Nonetheless, it appears that Uniswap failed in its function and also posted a much higher price than normal.

Compound’s liquidation this morning amounted to $89 million, of which about $52 million came from DAI, according to data from DuneAnalytics.

One liquidation in particular is notable for its extremely large size of 46 million DAI repaid.

As DeFi researcher Sam Priestley explained, this liquidation was performed on a leveraged COMP farmer, who used USD Coin (USDC) and DAI collateral to power recursive borrowing in the same currencies. The apparent increase in DAI price put the account below the liquidation threshold.

The liquidator seized almost 2.4 billion cDAI, worth approximately $50 million with a price of $0.0209, while returning just $46 million in DAI. This is expected behavior given Compound’s current liquidation incentive of 8%.

The transaction in question involved the use of a flash swap from Uniswap and calls to update Compound’s oracle. Another four transactions issued by the same liquidator removed an additional $6 million in debt.

The event highlighted the dangers of relying on just a few data points for oracles, Chainlink (LINK) founder Sergey Nazarov told Cointelegraph. “We predicted this very exploit of centralized oracles and poor data quality over a year ago,” he said, mentioning his explanation of the risks of using a single exchange. He continued: 

“DeFi protocols that rely on centralized oracles that pull data from single exchanges, DEXes or otherwise, are inadvertently putting user funds at risk. […] The Chainlink network was unaffected by this exploit because we source data from multiple leading data providers and hundreds of exchanges, making sure we capture the real-world price of a cryptocurrency through proper market coverage.”

While there is no evidence to suggest active manipulation, the fact that DAI price jumped specifically on the exchanges used by Compound’s oracles could draw suspicion. In general, the liquidation adds to the recent flash loan hacks to highlight DeFi’s excessive reliance on just a few data sources as oracles, Nazarov concluded.





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Yearn Finance announces another ‘merger’ with the Cream lending protocol

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Two days after Yearn Finance (YFI) and Pickle Finance joined forces in DeFi’s first effective merger, Yearn founder Andre Cronje published details of another upcoming integration with Cream, a lending protocol similar to Compound and Aave.

The blog post, published on Thursday, outlines how the two protocols will cooperate for the launch of Cream V2. As part of the partnership, the teams will merge development resources and introduce several symbiotic interactions between the two protocols.

Yearn users will be able to put their vault tokens — their share in a yield farming strategy fund — as collateral to borrow on Cream. Furthermore, the farming strategies will be able to access leverage on the platform, potentially increasing their yield.

The cooperation will continue with future releases, with Cream specializing in lending products. Stable Credit, an upcoming lending platform built by Yearn, will be launched through Cream. A zero-collateral protocol that would allow more flexibility in lending was also teased as a future development.

Unlike with Pickle Finance though, the governance and token economics of Cream will remain unchanged. The two protocols will remain largely separate, with synergies more resemblant of a very close partnership, rather than an outright merger.

The community had raised concerns about not being consulted before the Pickle Finance merger, suggesting that the matter should have been put up for a vote. A team member later clarified that it technically did not require approval since most of the integrations were on Pickle’s side.

Chris Blec, a DeFi researcher who often takes an adversarial view of events, believes that these decisions highlight that governance tokens offer less control than people expect.

In a conversation with Cointelegraph, he clarified that these types of decisions would likely fall under the umbrella of “facilitating business development and integrations,” one of the decision-making powers that YFI holders granted to the core team in August.

The Yearn community has so far reacted positively to the Cream integration, but most have yet to process the announcement.

While the core team seems to be within their rights to approve partnerships and mergers, these actions may trigger further discussion of the role of the YFI token holders in the Yearn ecosystem.