What’s going on with the price of Aptos?

[ad_1]

According to CoinGecko, no cryptocurrency or token has climbed more in the past day or week than Aptos.

The Aptos blockchain native coin, APT, has more than doubled in price over the past seven days and is up 47%, to $18.46, in the past day alone. Year-to-date, Aptos has jumped 350%. Why?

It’s hard to pinpoint a specific reason, but data shows that around half of APT’s $2 billion volume over the past day came from the South Korean Won trading pair on the UpBit-based exchange. Singapore, according to CoinGecko. At the time of writing, APT was priced at $18.63 on UpBit.

That’s almost $0.50 more than its sale on Binance and most other exchanges and a sign that at least some of the activity is coming from arbitrage trades. Simply put, arbitrage traders profit from price gaps. They buy at the lowest price available and sell at the highest price they can get.

South Korean exchanges so frequently list crypto assets at higher prices than their global counterparts that the difference has been dubbed the Kimchi premium. Last year, the Seoul Central District Prosecutor’s Office opened an investigation into 2 billion Korean won worth of illegal remittances generated by arbitrage traders profiting from it.

It’s also worth noting that while Aptos is still only the 20th largest DeFi ecosystem, according to DeFi Llama, it has grown significantly over the past month. DeFi volume on Aptos has grown from $14 million last month to $51 million in January and the month isn’t even over yet.

Growth in Aptos trading volume on decentralized exchanges. Image: DeFi Llama

Another 10% of APT volume over the past day came from the Binances APT and Binance USD (BUSD) trading pair. Binance, the world’s largest crypto exchange by volume, also recently introduced two APT liquidity pools, which now account for an additional 18% of APT trading volume.

Liquidity pools power peer-to-peer trading of crypto assets. Users are incentivized to pool or deposit their tokens so that they can be traded with other users. They are essential to the functioning of decentralized exchanges, like Uniswap and Curve. But centralized exchanges like Binance also use them.

On January 20, the Binance Liquid Swap platform launched its APT/Tether and APT/Bitcoin liquidity pools. The platform rewards users with BNB, the exchange utility token, for depositing funds into the pools.

At the time of writing, Binance promises a 92.42% return on APT/USDT and a 99.49% return on APT/BTC liquidity pool deposits. Of this amount, users would receive 0.71% and 1.07% BNB rewards respectively, paid hourly.

Aptos has consistently outperformed the market since the start of the year. But it got off to a rocky start when its mainnet launched in October.

The project received a lot of backlash for not releasing its tokenomics sooner than it did. Critics piled up when the blockchain, which promised speeds of up to 150,000 transactions per second, showed speeds of 4 transactions per second after its big debut.

At the time, Aptos co-founder Mo Shaikh said on Twitter that it was a sign the network was slowing down before projects went live.

Aptos backers include many venture capital firms that have become industry stalwarts: Andreesen Horowitz, Multicoin Capital, Jump Crypto, Tiger Global Management, Blocktower Capital, and Coinbase Ventures. And ahead of launch, the project closed a $200 million strategic round and a $150 million Series A round.

This list also includes two companies that have since filed for bankruptcy: hedge fund Three Arrows Capital and FTX Ventures, the venture capital arm of the Sam Bankman-Frieds crypto empire.

Stay up to date with crypto news, get daily updates in your inbox.

[ad_2]