- XDC Network coin has jumped by over 200% from the lowest level this year.
- Its volume - especially from Huobi and KuCoin - is rising.
- The coin has become highly overbought.
XDC Network price has been one of the best-performing cryptocurrencies this month as its token jumped. The token soared to a high of $0.0621 on Tuesday, the highest level since May last year. In all, it has jumped by more than 200% from the lowest level this year, giving it a market cap of over $829 million.
Exchange volume rising
XDC Network is a layer 1 platform that aims to become one of the biggest competitors to Ethereum and other platforms like Solana and Polkadoy. It uses a decentralized ledger technology that is faster and cheaper than other blockchains.
For example, it can handle over 2,000 transactions per second (TPS) compared to Ethereum’s 7. Also, is average transaction cost stands at $0.00001 compared to Bitcoin’s $15 and Ethereum’s $10. It achieves this by using a technology known as the Chained Hotstuff, which is part of the Byzantine fault tolerance (BFT) consensus.
The challenge for XDC Network is that the layer-1 and layer-2 industries have become highly competitive. In addition to Ethereum, the number of players competing in the industry has grown to include Tron, Polkadot, and Solana.
Further, the layer-2 industry is now becoming more popular, with key players in the sector being the likes of Arbitrum, Optimism, and Polygon. These layer 1 and layer 2 networks have gained billions of dollars in TVL and millions of users.
XDC Network, on the other hand, has struggled to gain traction in the past few years. A quick look at its DeFi ecosystem shows that it has a TVL of just 82 million XDC coins, which are equivalent to over $4.47 million. The most popular DeFi dApps in the ecosystem are XSwap Protocol, Globiance, Fathom Dex, and IcecreamSwap.
It is unclear why XDC Network’s token has jumped in the past few days. A closer look shows that most of the volume is coming from Huobi, which has a 42% share. It is followed by KuCoin and Gate.io. Therefore, since this volume is not widespread and since there is no important news, I think it is part of a pump and dump or a wash sale.
XDC Network price prediction
The daily chart shows that the XDC Network price has been in a strong bullish trend in the past few days. It has already flipped the important resistance level at $0.045 into a support. This price was the highest level on April 16th. The coin has jumped above the 25-day and 50-day moving averages.
At the same time, the MACD has jumped while the Stochastic Oscillator has moved to the overbought level. Therefore, I suspect that risk/reward ratio is now unfavourable since the coin has gotten overbought. As such, there is a likelihood that the coin will retreat and retest the support at $0.045.
