Key Reason Why Investors Must Avoid MATIC, SHIB, UNI

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As a seasoned researcher who has witnessed the rise and fall of numerous cryptocurrencies, I can’t help but feel a sense of deja vu when analyzing the current state of MATIC, SHIB, and UNI. The high degree of centralization in these assets is a red flag that has been raised time and time again in this industry.

For several months now, the cryptocurrency market has been moving sideways due to the ongoing consolidation in Bitcoin‘s price trend. With an extended correction on the horizon, coins such as MATIC, SHIB, and UNI might experience substantial drops because a small group of entities control most of their supply.

Centralization Risks Loom Over MATIC, SHIB, UNI

Centralization is a key issue in the cryptocurrency market that continues to stir debate. Centralization in this context refers to the concentration of a cryptocurrency’s total supply in the hands of a few wallets. If a small group holds the major portion of a particular asset, it could lead to market manipulation and other malpractice that could sabotage retail investors. MATIC, SHIB, and UNI currently show such a high degree of centralization as significant portions of their supply are held by the top 10 wallets

Polygon (MATIC)

As an analyst, I’ve noticed an interesting trend with Polygon (MATIC). Approximately 69.4% of its total supply is controlled by just the top 10 wallets, which points towards a high level of centralization. This means that a relatively small number of significant players have a substantial influence over the supply. Consequently, any shifts in their holdings could potentially exert a considerable impact on the price of MATIC.

Right now, the Polygon coin is being exchanged for $0.4, which gives it a total market value of $4 billion. On the other hand, the Matic coin has dropped by about 86.2% from its all-time high ($2.9) and has been moving sideways since May 2022.

Key Reason Why Investors Must Avoid MATIC, SHIB, UNI

As the network prepares for the transition from using MATIC tokens to POL, potential buyers might strive to safeguard the $0.33 price level. If the price continues to fall, it could dip down to $0.26, and if that support fails, it may further decline to around $0.18.

Shiba Inu (SHIB)

Based on Santiment’s findings, about 61.2% of Shiba Inu (SHIB) tokens are held by the top 10 wallets. Despite Shiba Inu boasting a large community and numerous supporters, this concentration suggests that the decisions of a few influential holders could exert substantial influence on SHIB’s price movement.

According to the forecast for Shiba Inu, its value, which is now at approximately $0.00001378, seems to have reverted back to a range it’s been oscillating near since May 2022, after experiencing a six-month adjustment period.

Key Reason Why Investors Must Avoid MATIC, SHIB, UNI

The price of Shiba Inu (SHIB) has dropped by 84.5% since its all-time high ($0.00008845), and it’s currently moving towards the next support level of $0.000012. If this support is breached, the asset could fall further to $0.00001.

Uniswap (UNI)

In simple terms, over half (50.8%) of the Uniswap’s total UNI tokens are controlled by the top 10 wallets. Although Uniswap prides itself on its decentralized nature, particularly in governance, this high concentration of tokens among large holders could potentially sway the decision-making process due to their substantial control over the tokens.

As of now, UNI is trading at $5.6 and has a market capitalization of $3.38 Billion. The overall direction for Uniswap’s coin is flat, having dropped 87.4% from its all-time high of $44.97. If the selling pressure continues, UNI might revisit its support at $4.6 and potentially drop further to $3.8.

Key Reason Why Investors Must Avoid MATIC, SHIB, UNI

However, the immediate resistances are at $6.6 and $8.6.

Conclusion

As a crypto investor, I always tread carefully when it comes to assets where a small group holds most of the supply. Such situations can potentially lead to instability due to the concentration of power. Yet, if the holders are reluctant to sell, this could be a promising sign, suggesting they have faith in the asset’s long-term prospects and value.

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2024-08-30 20:26