- Injective has become one of the fastest-growing coins in the industry.
- INJ has jumped by more than 2,500% from the lowest point in 2023.
- There are some concerns about this unstoppable bull run.
Injective (INJ) price unstoppable bull run continued as the token reached a new all-time high on Tuesday morning. The DeFi token surged to a record high of $38.25, meaning it that it has jumped by over 2,500% from its lowest point in January. This increase has brought its total market cap to over $3.4 billion,
Questions about INJ rally linger
Injective has become one of the best-performing crypto tokens this year as it continues to defy gravity. It has often done well even when other cryptocurrencies are in a downward trend.
The main issue is that Injective’s ecosystem is quite tiny for it to deserve a $3 billion market cap. According to DeFi Llama, Injective has a Total Value Locked (TVL) of just $11.9 million in its DeFi ecosystem. While other network’s TVL is rising, the figure has been in a downward trend after peaking at over $27 million in May.
Helix is the biggest player in Injective’s ecosystem with over $9 million in TVL. While INJ token has risen substantially this year, Helix’s TVL has dropped by almost 20% in the past 30 days.
Helix’s total transaction volume has also not grown substantially in the past few days. It handled over $32 million worth of tokens in the past 24 hours, making it the 29th biggest exchange in the world.
The other biggest players in the Injective ecosystem are Levana Perps, Black Panther, and Astroport. All these are relatively small parts of the ecosystem. Taken together, there are questions about how a slow-growing platform with just $34 million in TVL can have a market cap of over $3.4 billion.
Therefore, some analysts believe that the Injective price surge has been driven by market makers and venture capitalists. Injective is backed by VC firms like Jump and Panterra. Mark Cuban is also an investor.
Looking at exchange flows, data by CoinMarketCap shows that most of Injective is being traded in Binance. Some other big players in Injective volume are little-known exchanges like BIKA, CITEX, Bitunix, and BtcTurk.
Injective price forecast
The daily chart shows that the INJ price has been in a strong uptrend in the past few months. In this period, the token has remained above all moving averages, signaling that bulls are in control. It has also flipped several important resistance levels into support. Most recently, it flipped the psychological resistance at $35.
Injective’s oscillators like the Relative Strength Index (RSI) and the Stochastic Oscillator have all moved to the overbought level. Therefore, it seems like the INJ token has the momentum to continue rising as buyers target the key resistance at $50. This view will be confirmed if it moves above $40.
In the long-term, however, Injective price will likely retreat as VCs and market makers start exiting their positions. We saw this situation happen in Cardano, which I warned that it was severely overvalued several times.
