Lido DAO (LDO) price slumped more than 20% in the past week. On-chain data shows that large transactions are declining, while long-term token holders appear to be exiting their positions. Such network activity suggests that the price of LDO could be bound for further losses.
Crypto Whales Shy Away from Lido DAO
Lido DAO is a leading liquidity-staking derivative platform that allows crypto investors to gain exposure to ETH2.0 staking upside without running individual nodes. Amongst other factors, the recent decline in the crypto market seems to have spooked LDO whales.
On-chain data from the analytics platform, IntoTheBlock shows that the number of large transactions on the Lido DAO protocol has been trending downwards since the Ethereum Shanghai announcement on March 16.
LIDO whales performed 227 large transactions worth more than $100,000 on March 15. But by March 21, the number of large transactions on the network had declined to 47 transactions, representing an 80% drop.
The number of large transactions on a blockchain is often positively correlated to price. This growing disinterest from crypto whales and institutional investors could soon LDO price.
Similarly, long-term holders appear to be selling their LDO holdings, further buttressing the bearish stance.
The Average Time Held of Coin transacted on the LIDO protocol has dropped considerably. On March 13, the average LDO Coin Holding Time was six months. By March 21, it had dropped to one month.
The Coins Holding Time metric monitors the average period of time that holders of a token keep their assets before trading. Declining values often signal a bearish trend of long-term participants leaving the network.
LDO Price Prediction: The $2 Mark Beckons
IntoTheBlock’s Global In/Out of Money Around Price (IOMAP) data suggests that the price of the Lido DAO native token could drop below $2 if it loses its current support level at $2.31.
At the $2.31 zone, 3,500 addresses that bought 83.4 million LDO tokens can offer support. But failure to hold this line could trigger a sell-off that will likely drop Lido DAO’s price to $1.93. Here, 2,800 addresses purchased 157 million LDO, providing a significant area of demand.
It is worth noting that the price of Lido DAO must first scale the next major resistance at $2.72 to invalidate the bearish outlook. A breakthrough could see Lido DAO edge closer to its all-time high as it approaches $5, where 4,000 addresses bought 9 million LDO.
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