Key Takeaways:
The dramatic rise of liquid staking token Stader (SD) to $0.95 has captured widespread attention for the cryptocurrency as it approaches the pivotal threshold of $1. The price hike saw the value of SD increase by 213% from its lowest level in November.
This surge has pushed the market capitalization of Stader to $37.9 million, with the token’s fully diluted valuation, the value of its total supply, hitting $111.7 million.
Stader (SD) Coin Hits $1 as Demand for Liquid Staking Protocol Increase
Stader has become a prominent player in the liquid staking industry, with nearly $426 million worth of assets held on the Ethereum network, while the remaining are held in Hedera (HBAR), Polygon (POL), and Binance Smart Chain (BNB).
According to the protocol’s website, it provides its services to over 100,000 users from around the world.
The purpose of liquid staking protocols is to allow crypto users to swap staked coins for liquid assets that represent the cryptocurrency they originally staked. These liquid tokens can then be traded on exchanges, utilized in decentralized finance protocols, and redeemed for the staked asset.
Data from DefiLlama indicated that the total value locked in the Stader ecosystem has been declining after peaking at $778 million on March 14, registering a record-low of $381 million in September before rebounding to $463 million this month.
The recovery suggests that there is potential for growth as SD continues to regain momentum. Analysts are predicting that Ether (ETH) could climb up to $5,000 in the coming months, which could gravely benefit Ethereum-based liquid staking protocols like Stader.
What Factors Could Dictate Stader (SD) Tokens Move Beyond $1?
However, one notable risk for Stader’s price is its maximum supply of 120 million tokens, out of which, 40.76 million SD are in circulation. The network releases 1.38 million SD coins each month, leading to further dilution.
Recently, SD experienced a technical breakout, with its price surging after forming a falling wedge pattern on the chart, which signifies a bullish trend. Typically, a price breakout occurs when the falling wedge pattern closes in on its confluence point.
After moving above the 50-day and 200-day moving averages, Stader has approached the psychological $1 mark. The cryptocurrency’s Relative Strength Index and Stochastic Oscillator are now signaling an upward trend, hitting overbought levels.
Considering these technical factors, the price of Stader may likely experience a pullback and retest the lower side of the wedge pattern at $0.40, which is about 60% below its current price point.
At the time of writing, Stader (SD) is trading at $1.03 – up 16.18% in the last 24 hours.
