On Wednesday, cryptocurrency prices suffered a major pullback as their correlation with stocks continued. Bitcoin crashed below $30,000 while the total market cap of all coins declined to about $1.2 trillion. The Near Protocol price declined as well and is currently trading at $5.95, which is lower than this week’s high of $7.53.
USN not gaining traction
Near Protocol is one of the biggest blockchain platforms in the world. Its token is valued at over $4.3 billion, making it the 23rd biggest coin. The network’s goal is to become a friendly platform for developers to build their decentralized applications, such as those in finance and gaming.
To accelerate this growth, the developers recently launched the USN stablecoin. Like Terra USD, USN is an algorithmic stablecoin that is soft-pegged to the US dollar and is then backed by a reserve fund that contains the NEAR token and USDT. The peg to the USD is done through an on-chain arbitrage and a self-balancing reserve fund. It is also similar to Tron’s USDD.
The USN stablecoin is relatively risky for Near Protocol, considering that Terra USD failed even after the developers bought Bitcoin worth billions of dollars to secure it. Other algorithmic stablecoins like DEI and Neutrino have also lost their pegs recently. However, according to CoinMarketCap, USN is trading at $1, meaning that the peg has held quite well recently.
However, it has not gained a lot of traction like USDD. CoinMarketCap and CoinGecko don’t show its market cap. USDD, on the other hand, has seen its market cap rise to $317 million in less than a month.
Near Protocol price prediction
Like other cryptocurrencies, the NEAR price declined sharply last week. It fell to a low of $3.47, which was the lowest level since August last year. At its peak, the coin was trading at $20. After its crash, NEAR formed a relief rally that saw its price retest the resistance at $7.7. Now, this recovery rally has faltered while the coin remains below all moving averages.
Therefore, while the RSI has moved to the oversold level, the outlook of the coin is bearish, with the next key support level being at $4. As a result, the stop-loss for this trade will be at $7.
