Author: Duoduo, LD Capital
Recently, the cryptocurrency market has been weak, with continuous outflow of funds, low volatility of Bitcoin and Ethereum, and low trading volume. Stock funds are mainly concentrated in individual projects for short-term speculation. So, how to find trading opportunities in the capital market?
The author observed and tracked the short-term capital situation of TRB (Tellor Tributes, providing oracle services), and tried to find some signals before the upward start; then understood the fundamental situation, mainly looking for positive or negative factors. From August 25th to the early morning of August 28th, the price of TRB tokens rose from $9.6 to a high of $16, an increase of nearly 66%, and then entered a correction.
1. Capital Situation
First, let’s look at the basic information of the token. The total supply of tokens is about 2.49 million, and the circulation is about 2.48 million, basically in a fully circulating state.
- The total number of stablecoin users worldwide has already created the fifth-largest bank in the United States.
- Overview of Global Cryptocurrency Transaction Taxes
- Severe Lag Analysis of India’s Cryptocurrency Tax System, Regulatory Status, and Trends
The top ten holdings on August 26th are as follows, with Binance holding over 43% of the tokens, indicating a high concentration of tokens.
After the sharp drop on August 18th, the price of TRB entered the bottom price range since the beginning of this year and also the bottom range since 2021. After oscillating for a few days, the daily chart once again gained support near $9.5.
On August 21st, a large amount of transfer was observed on the chain, reaching the highest level since January this year, much higher than the previous data. At the same time, the price did not change significantly and remained around $10. We believe that someone may be building positions on the chain at this time, so we will further pay attention to the changes in contract trading volume and holding volume. However, abnormal transfers on the chain do not necessarily represent position building behavior, and need to be considered in conjunction with the token’s price range, whether there are abnormal events, subsequent trading volume and price changes, etc.
On the morning of August 26th, it was observed that the contract trading volume and holding volume were steadily increasing. At the same time, the price broke through the upper limit of the 4-hour bottom price range.
The following figure shows the derivative data on the morning of August 26th. The 24-hour contract trading volume increased by 151% and the contract holding volume increased by 93%. The holding of large accounts is in a long position, while the long-short ratio is 0.96, indicating that there are a large number of retail investors shorting. Therefore, we believe that there is a high probability of short-term capital entering TRB and the token rising.
In the next two days, the contract trading volume and position of TRB have both experienced a significant increase. In the past 24 hours, its contract trading volume was $1.6 billion, and the position was about $68 million.
The following chart shows the changes in the main indicators of the TRB contract as of August 28th. It can be seen that the position has continued to increase until the early morning of August 28th. There was a large short liquidation and a decrease in position when the price dropped to $16. Afterwards, the position changed from a growth trend to a downward trend, and the price also fluctuated downwards. The change in funding rate reached the largest negative premium after the price dropped to $16.
Currently, large holders are still in a long position. The long/short position ratio is 0.3452, indicating that a large number of retail investors are shorting. The funding rate is still negative, but it has returned to a relatively normal level.
II. Fundamental Situation
Understand the fundamental information of the project, confirm the current status of the project, and whether there are obvious positive or negative factors.
Tellor Tributes is a project launched in 2019 and belongs to the decentralized oracle protocol, incentivizing open, permissionless data reporting and data verification networks to ensure that data can be provided by anyone and checked by everyone.
Tellor utilizes a mining mechanism to achieve the Oracle system and realize a decentralized off-chain data query mechanism. The entire system consists of a network of data providers (miners), who competitively add data points to the on-chain database through the “Tributes” (TRB) token incentive system.
TRB adopts a token issuance model that combines POS and POW, with no fixed token supply. Nodes stake TRB tokens and complete POW puzzle challenges. The first five nodes to solve the challenge and submit data will receive TRB token rewards. Starting from ETH block height 9619370, the block reward will decrease by 0.003% per block until it reaches 1 TRB, and then it will remain unchanged. At this time, each block will produce 5.5 tokens, with an inflation rate of 17%. The reward has entered the 1 TRB stage in 2021.
Based on the current circulating supply, the annual inflation rate is 17%, which means there will be an additional 420,000 tokens per year, and 35,000 tokens per month.
The community is still maintaining active development and community interaction. The main files on Github were updated 3 days ago, indicating a high update frequency. Twitter has 32.5K followers and 1488 posts, with tweets being posted on most working days, indicating a high level of activity. YouTube has 1.28k subscribers and 229 videos, with weekly development meetings being published, and the latest release is the content of the previous week’s meeting. Discord has 4.7K followers, and there have been dozens of messages in the discussion area in recent days, ranging from a few to a few dozen, indicating moderate activity. The latest blog article was updated on August 9, 2023.
The business development is average. According to the official website, the currently deployed public chains or layer 2 solutions are shown in the figure below, including recently popular L2 solutions such as op/arb/base.
The project has not disclosed the following specific information: the number and distribution of nodes participating in the network and providing data reporting services; the actual DAPPs using the oracle; the total amount of data provided by the oracle; the situation of service fee income, etc.
Overall, Tellor Tributes is in the stage of maintaining operations, without major breakthroughs and progress in technology and business, and the project’s competitive advantage is insufficient.
III. Conclusion
The short-term price increase of Tellor Tributes (TRB) is mainly driven by funds. After the surge in the early morning of August 28, the holdings decreased and the price also fell significantly.
When looking for trading opportunities in the current market, you can pay attention to the following points:
1. Whether the token price range (available on Binance Futures) is in the bottom area for a period of time.
2. The concentration of token holdings and in whose hands they are concentrated.
3. Whether there has been any abnormal on-chain activity recently.
4. Whether there has been a significant increase in token contract trading volume and holdings, and whether it has been maintained for a period of time.
5. The specific situation of the long-short ratio of large account holdings and the long-short ratio of the number of holders.
6. If the holdings continue to increase and the price falls after a spike, it may form a short-term price top.
Like what you're reading? Subscribe to our top stories.
We will continue to update Gambling Chain; if you have any questions or suggestions, please contact us!
