On-chain Analysis (Futures): Status - SNT
On-chain Analysis (Futures): Status - SNT
This on-chain analysis episode takes a unique turn as we explore a token drawing interest from whale investors in the futures market. Read on and learn how to apply these signals in other cases.
Note: This analysis is supported by our Crypto Macro dashboard, Funding Rate tab.
What is Status?
Status Network (SNT) is a fully open-source dApp that provides users with a suite of tools, including instant peer-to-peer (P2P) messaging, a user-friendly crypto wallet, and a Web3 browser.
The primary goal of Status is to restore data sovereignty to users.
The platform allows direct interaction with applications on the Ethereum network while ensuring an end-to-end encryption framework for P2P private conversations.
Status enables users to make blockchain payments, allowing instant cryptocurrency transfers.
In line with the principles of cryptocurrency and Web3 technology, Status is censorship-resistant, facilitating wallet-to-wallet communication through pseudonymous usernames—a unique and appreciated feature.
SNT, or Status Network Token, serves as the utility token for the Status platform. Users can leverage SNT to access various features within the platform, such as registering usernames and acquiring Status Sticker Packs. These use cases generate buying pressure, supporting the price of SNT.
Additionally, SNT functions as a governance token within the Status ecosystem, granting holders the right to vote on governance proposals that influence the protocol's future development.
As we sum up this basic information, keep in mind that Status Network is an established project that was launched in 2017; it is not a new project. This historical context is one of the key factors in our analysis below.
03 Reasons Why SNT Deserves Your Attention At The Moment
1. SNT Wallet Movements
The high number of transactions (blue line in Figure 1), along with the sudden movement of a large amount of tokens in one day accounting for nearly 30% of the circulating supply (green bar in Figure 1), indicates that the SNT token has been gaining price momentum in recent days.
The number of large token transfers from a wallet address on a particular day, or ‘Max Transfer Amount’ also increased sharply for many consecutive days between Nov 1 and Nov 3. This means that whale wallets have started their move. Indeed, we later found that the number specifically comes from Binance cold wallets that have recently become active again.
Binance cold wallets: wallets that are owned by Binance to store a significant portion of assets offline).
The movement of over 250M $SNT from the Binance cold wallets to Binance, along with a subsequent withdrawal of 150M $SNT the next day, suggests that Binance is actively providing liquidity to its exchange.
This significant transfer, constituting almost 13% of the total $SNT movement in three days, indicates substantial demand for $SNT during this period, as if people wanted to buy but there was no $SNT available to purchase.
Largest Binance transfers on
Nov 01, 2023: 104.963M SNT
Nov 02, 2023: 150M SNT
Nov 03, 2023: 153.096M SNT
In addition, newly created wallets withdrew a substantial amount of $SNT from exchanges (especially from Coinbase) during the same period, approximately ~$500K per wallet in smaller transactions.
This action could indicate either significant investors looking to acquire $SNT or the exchange attempting to decrease the supply on its platform, thereby making $SNT more scarce.
After the price increase, these addresses showed no signs of moving to exchanges for distribution, either; on the contrary, they continued to withdraw more when the price dropped.
As of time of writing, none of these wallets have sold any $SNT.
New wallets
0x55…111b: 5M SNT
0xe7…cf82: 11.156M SNT
0x0d…E4dc: 10.285M SNT
0x1D…26EB: 10.285M SNT
0x85…4b57: 10.493M SNT
0xc7…59af: 5.228M SNT
0x39…f640: 10.493M SNT
0x94…1567: 35M SNT
0x96…2c30: 23.598M SNT
0x7b…4cbb: 515.679K SNT
In contrast, when SNT reached $0.065, some wallets deposited $SNT into both Binance and Coinbase. These wallets had accumulated SNT two years ago but have yet to see any profit, possibly indicating an attempt to sell $SNT to minimize their losses. This could also be a strategy employed by market makers to unload $SNT for subsequent repurchases.
Despite a 30% price drop from $0.065 to $0.045, new wallet addresses continue to accumulate SNT, defying retail sellers who were cutting losses and suggesting bullish sentiment.
2. Upbit's Dominance and Market Impact
With 45% control (at the time of research) over total 3.9B $SNT in circulation, Upbit's influence could significantly impact the price. Tokens listed on Upbit, such as $CYBER, $HIFI, $LOOM, $STRAX, $GAS, and $POLYX, have experienced notable price hikes, and $SNT was no exception.
However, after $SNT reached its highest point at $0.065, there were no indications that Upbit was depositing more $SNT to its exchange, suggesting a lack of intention to sell.
3. SNT's Listing on Binance's USD-Market and Funding Rate Dynamics
After SNT was listed on Binance's USD-Market, it attracted significant short interest from Binance, Bybit, and BingX, resulting in a negative Funding Rate of -0.1 across exchanges. Despite a modest negative Funding Rate, another sharp decrease occurred when the price dropped from $0.052 to $0.048, indicating strong shorting during the preceding price rally. Subsequently, a sharp price increase to $0.065 brought the Funding Rate back to a more balanced position.
Even with a price decrease from $0.065 to $0.045 later on, Funding Rates did not decrease significantly, suggesting a balanced short position. However, from $0.045 to $0.053, Funding Rates again sharply decreased to -0.2 across exchanges.
Although the Funding Rates are not highly imbalanced at the moment, the gradual increase in Funding Rates suggests that the price is becoming increasingly favorable for short-selling.
Conclusion
The current price of SNT is high, but it seems like nobody wants to sell it. On the contrary, exchanges and whales are still looking to withdraw SNT to their wallets to increase its scarcity. Finally, with the Upbit narrative still hot, SNT could be a noteworthy token in the coming time.
NFA - DYOR.
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