Harmony Protocol (ONE) Breakout Near $0.10
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Harmony Protocol (ONE) is the next platform project to attempt a breakout and possibly recover the $0.10 range. ONE has peaked at $0.18 during the bull market in 2021, and has potential upside based on wider adoption and compatibility with other projects and tokens.
ONE traded at around $0.08, up more than 30% in the past week in a rapid breakout from the recent bottom. The rally is still shaky and happening on low volumes. ONE is an outlier as almost all cryptocurrency trading is subdued ahead of the weekend.
Harmony Protocol Adopts DeFi Projects
The prominence of Harmony Protocol is coming from its attempt to create another venue for faster usage of the most prominent DeFi protocols. Harmony has now added SushiSwap, one of the most prominent decentralized exchanges.
Performing swaps on decentralized exchanges has been a hassle for Ethereum users. Even the simplest swap may be front-run by bots, or require exorbitant gas fees that sometimes exceed the value of the tokens.
Harmony Protocol follows the path of Polygon (MATIC), using parallel computation that gets settled on the Ethereum network. This allows for a simulated version of most DeFi technologies, where pools and swapping work with lower fees.
Buying ONE, the native token of Harmony Protocol is one way to provide liquidity on SushiSwap. The ONE tokens will be converted to Wrapped ONE (WONE) through a smart contract, and accrue more WONE rewards which can then be converted to ONE.
Harmony Also Adds Terra, CakeSwap
In addition to SushiSwap, Harmony has added access to PancakeSwap (CAKE) and Terra (LUNA).
PancakeSwap means compatible access to Binance Smart Chain tokens. LUNA gives exposure to another growing ecosystem of crypto-backed lending.
What is Harmony Protocol
Harmony Protocol is working on creating shards, which are one of the possible scaling solutions for scaling the Ethereum network. Since Ethereum has not competed its native shards, former token projects are taking up the task of achieving a higher level of transaction and computation.
Harmony launched its native mainnet two years ago. The Harmony startup ended its token sale also in 2019, raising $23M.
Now, the network is starting to add existing projects and tokens to its portfolio, offering another on-ramp to DeFi.
Harmony Protocol requires a native wallet to access the ONE token and potentially copies of all DeFi projects that choose to also exist on the Harmony network. The Harmony wallet is easily accessible as a browser extension.
Harmony is both a competitor and an addition to projects like Polygon and Polkadot, which also have their own scaling solution to Ethereum’s high fees, with a slightly different approach. Potentially, all those projects can run their versions of Maker, Compound, Aave, Uniswap and other similar projects, thus expanding the outreach of DeFi at a lower price.
Harmony Protocol is starting to also build up a list of distributed apps in other industries. The project will soon be listed on DappRadar to observe the activity and user interest.
Is ONE a Good Investment
ONE, like many crypto assets, has been extremely volatile. The token traded below a penny before the rise in 2021, when it peaked at $0.18.
Now, the new breakout is taking ONE closer to $0.10. ONE trading volumes remain slim, at around $75M in 24 hours, below the trading activity of the more prominent MATIC and DOT tokens.
However, ONE may soon start locking in value as ONE deposits, and being chosen as a new venue for DeFi may boost the value locked to give ONE a higher valuation.
ONE Trading Profile
The potential of ONE lies in its Binance trading pair, where more than 60% of the volumes are concentrated. This pair can easily attract traders, creating a spike in prices.
ONE also has significant support from trading both against USDT and BUSD. So far, a listing on Coinbase is at the level of rumors. The ONE community is more active on social media, also proposing ONE as a potential token to be added to the Grayscale Capital portfolio.
DeFi Remains Relatively Risky
The DeFi space locks in about $54B in value, most of it in the form of ETH collateral. Other tokens are used as collateral as well, including dollar-pegged stablecoins.
The DeFi space, however, remains highly risky. For retail investors, the riskiest activity is liquidity farming. While liquidity farming can create significant passive income, it is also a potential source of deep losses.
A less risky way for gains is to stake ONE and support the blockchain’s validators.
At current prices, the previous requirement for a minimum of 1,000 ONE staked may be lowered, offering a way to increase ONE ownership without exposure to risky decentralized trading pairs.
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