The State of Cryptocurrency Lending
True, the cryptocurrency lending field is congested. Given the open-source nature of most blockchain projects and the value of associated applications as cryptocurrencies, control will always be a big deal. The scramble for ownership, more so, for liquid coins as Bitcoin, has been catalyzed by the mushrooming cryptocurrency lending startups.
Because of these sprouting firms, not only can investors earn from staking, assuming the token/coin supports such features, but lending via approved lending platforms means extra revenue. It’s an opportunity cost, a decision that the owner must make with the easier route increasingly being revenue via lending over traditional staking thanks to superior returns of the former.
To spell how lucrative cryptocurrency lending is, Genesis Global Trading, the lending arm of Genesis Global Trading, added $746 million of cryptocurrency loans in Q2 2019. This is a 48 percent quarter-to-quarter increase, a stark contrast to staking returns coinciding with a “crypto winter” which was officially disheveling for cryptocurrency investors.
Meanwhile, a competing provider, CryptoLend has more than $381 million of assets under management with an annual best fix rate of 49 percent. On the other end, Celsius Network, a competing crypto lending firm, has distributed over $2 billion of cryptocurrency loans. Behind it are more than 30k active wallets and assets under management exceeding $300 million.
Nexo Migrating a Portion of Their Tokens From Ethereum to Binance Chain
Even so, Nexo has managed to be visible despite the stiff competition. Differentiating itself by offering attractive features and supporting an array of coins, Nexo is ahead of the pack supporting over 45 fiat currencies.
Their publicity was further heightened following their partnership with Binance. Besides opening an instant crypto credit line for Binance Coin (BNB) back in June 2018, Nexo is following that up by migrating a portion of their NEXO ERC-20 tokens to Binance Chain’s BEP-2 protocol.
Unlike Ethereum, which is currently struggling with scalability-but working towards addressing this concern, Binance chain is scalable and fast as on-chain transactions can settle in less than a second. Additionally, transaction fees are low. Then again, the prospect of automatic listing, once the Binance DEX goes live, is attractive.
Notifying the community of their decision, Antoni Trenchev, Managing Director at Nexo, said:
“Nexo is happy to support Binance in its bold move to build its cutting-edge blockchain that outperforms existing solutions and has set the standard for the development of the largest Decentralized Crypto Exchange - Binance DEX.”
Expressing the same excitement, Ted Lin, Chief Growth Officer of Binance, added:
“It’s delightful to see that more and more projects have chosen to migrate their tokens onto Binance Chain. We are happy to have NEXO join the Binance Chain ecosystem.”
Negotiation With Binance
Even so, Nexo is not settling. Already, Nexo has initiated discussions with Binance. If there is consensus, NEXO BEP-2 compliant token will list at the Binance DEX upon launch. To that end, the Nexo development team will spearhead the creation of a BEP-2 compliant NEXO token that is tradable at the Binance DEX.
To make it easier, the team will also build a two-way token swap, giving an option for holders, even those willing to stick with Ethereum. The tool will be available in mobile as well as from the platform, helping NEXO token holders to easily swap between the Ethereum and Binance Chain networks. The genius here is that, despite the expected back and forth movements, the total number of NEXO tokens in circulation will be well accounted for.
NEXO/USDT Price Analysis
From the chart, buyers have the upper hand. Even though there is a weakness as the price action of the last few days reveals, there is an opportunity for aggressive traders to buy the dips. Immediate support is at 10 cents, and leading this trade plan is the conspicuous bull bar of May 29.
As a bullish breakout bar, it has above average volumes. Then again, prices of the past two months have been largely consolidating inside May 29 trade range. Overly, that is bullish from an effort versus results point of view.
Presently, the retest phase is over. Because of the resurgence, marked by the double bar bull reversal pattern of July 14 and 15, NEXO is officially trending at the third stage of a typical breakout pattern against the USD.
Further cementing this overview is the reaction of prices of the 50 and 61.8 percent Fibonacci retracement levels of H1 2019 trade range. Indicative, odds are NEXO prices could edge higher in days ahead.
Therefore, in light of this, the best course of action for aggressive traders would be to fine-tune entries in lower time frames with fitting targets at 14 cents, and later 22 cents. To counter against sharp drops, a stop-limit should be just below 10 cents, the breakout level.
Note that if the bear breakout bar is extensive, with high trading volumes exceeding those of May 29 of 132k, NEXO could tumble to 5 cents.
Disclaimer: Views and opinions expressed are those of the author and is not investment advice. Trading of any form involves risk. Do your research.