A widely followed crypto analyst says the entry of a $47 billion asset manager could provide a much-needed shot in the arm for decentralized exchange (DEX) protocol SushiSwap (SUSHI).
Will Clemente tells his 660,800 Twitter followers that one of the consistent use cases of crypto is enabling market participants to trade highly illiquid altcoins on decentralized exchanges.
Says Clemente,
“In fact, the ratio of DEX volume to centralized exchange spot volume is higher than it was this time last year mid bull run. There is clearly a consistent underlying demand to gamble in the crypto casino.”
Even amid increased demand from crypto traders, Clemente highlights that trading volume on SushiSwap is massively down this year.
“Due to leadership issues amongst other things, SushiSwap’s volumes (filtered for wash trading) are down an estimated 89% year-to-date by Messari. This has put them significantly behind competitors such as Uniswap.”
However, Clemente says that things are starting to look up for the decentralized exchange protocol after SushiSwap hired Jared Grey as head chef. Grey, the former CEO of defunct crypto exchange Bitfineon, previously said that he plans to return Sushi to its “rightful status among its peers.”
Clemente also highlights that New York-based asset manager GoldenTree has taken a relatively small position in SUSHI.
“Next, [$47 billion] asset manager GoldenTree has taken a $7.27 million position in Sushi. Expressing commitment by publicly sharing their wallet and intentions to make changes to turn around the protocol with a post in the Sushi forum.”
According to Clemente, the entry of GoldenTree and its public revelation of its position could change the fortunes of SUSHI.
“Aside from the assumption that the brilliant Avi Felman and GoldenTree will do everything in their power to not let their first major public crypto position go bust, I think this offers an interesting asymmetric opportunity for SUSHI.
If GoldenTree orchestrates one positive change, the market will extrapolate that they’ll make several more. Make two changes and the market will extrapolate out even further. This could create a reflexive effect for the SUSHI turnaround narrative.
Similar to Alameda’s bet on DOGE, I think the asymmetry is favorable here in that Avi, GoldenTree and the resources behind them will likely implement at least a few positive structural changes, which is all the market needs to project out further positive expectations.”
At time of writing, SUSHI is swapping hands for $1.27, down over 8% on the day.
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The post $47,000,000,000 Asset Manager Could Spark Turnaround of Decentralized Exchange Protocol: Analyst appeared first on The Daily Hodl.