Why Tezos Price Could Fall by Another 16%

The price of the cryptocurrency Tezos (XTZ) has fallen sharply in recent days, as was the case with many other cryptocurrencies. The native token XTZ fell to a low of about $1.4 in the meantime today. The last time the price was this low was on July 3. Tezos has since recovered to around $1.45, down nearly 15% from this week’s high.

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What is Tezos and why is the price falling?

Tezos is a leading blockchain project whose developers call it a self-changing crypto registry. It is a platform that allows developers to create complex applications based on smart contract technology. Some of the unique features of this project include autonomy, upgradeability, proof-of-stake, secure smart contracts, and formal verification.

Tezos was launched to the market in 2018. Since then, the developers have signed several important contracts, which has contributed to Tezos’ higher popularity among users and investors. For example, it is the official partner of Red Bull’s Formula 1 team and the Manchester United soccer club. These teams have widely used Tezos to launch their own NFT projects.

Still, one can get the feeling that Tezos has not achieved its goal of becoming a real alternative to Ethereum. For example, the total value of locked tokens (Total Value Locked) of DeFi platforms within the Tezos blockchain is only $40 million.

The largest DeFi platform Youves has a dominance of 33% in this ecosystem. It is followed by Tezos Liquidity with a total value of $13 million. The other DeFi protocols have significantly lower values.

This also means that Tezos has been overtaken by other relatively new blockchains such as Cronos, Avalanche, Polygon, and Waves.

The same is true for other sectors of the crypto industry such as non-fungible tokens (NFT) and the Metaverse. According to DappRadar, the volume of activity on Tezos has declined sharply in recent months. This decline is in line with that of other chains such as Ethereum and Solana. So how will the Tezos price evolve?

Tezos Price Forecast

In the four-hour chart, you can see that the XTZ price has seen a strong recovery in recent weeks. Along the way, the price line formed an ascending channel, shown in blue. Now the price has declined and is trading at its lowest level since July 5 of this year.

Tezos price has also fallen below the lines of the 25-day and 50-day moving averages, while the Relative Strength Index (RSI) has fallen below the neutral point. Therefore, there is a possibility that Tezos will fall further as sellers target the key support level at $1.2. This price is about 16% below the current level.

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(Featured image by sergeitokmakov via Pixabay)

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