Hello everyone, I'm making a post on the INJ crypto token which contains DATA and ANALYTICAL EVIDENCE relevant to investors (both short and long term), so they can make more prudent and informed decisions. What I'm presenting to you are the results of financial, fundamental and technical analysis I did on the digital asset INJ token, and they ARE NOT TO BE REGARDED AS INVESTMENT ADVICE.
WARNING FOR ALL INVESTORS: INJ token is undergoing a MASSIVE DEVALUATION, and it IS JUST BEGUN. I suggest you READ UNTIL THE END, because EVERY POINT FOLLOWS A LOGICAL SEQUENCE. Here are the reasons, proofs and analysis of why that's the case:
-INJ Futures funding rates, as you can see by their chart on CoinGlass (shown in the above picture) have been turning positive at a higher frequency for quite some time, indicating that spot traders are hedging for tail risk, meaning that their main positioning is either short-selling the underlying asset —(INJ token) or that there is a lot of selling taking place and spot traders want to hedge their opportunity risk by opening long positions in the futures market, just in case what they consider the lower probability event happens (which is INJ keeps appreciating in value)
-We are in a deflationary macroeconomic environment, which means that there is a shortage of liquidity in overall financial markets (including crypto) that keeps getting worse (except for banks, and they can't by law invest in crypto, given that banks capital requirements allows them to invest 90% of their capital into common stock shares and other securities, but not cryptocurrencies) because companies that invest in technology and crypto as a whole (VC, Private Equity and tech companies such as Micro strategy/Tesla/fintech companies and crypto brokers, with only the first two categories of firms being the biggest INJ investors) can't get cheap financing/refinancing since interest rates on debt refinancing operations rose considerably, which means that they can't invest the same way they used to and they're way more likely to take profit by closing their longs, starting with the more volatile ones (DeFi digital assets such as INJ). For reference and to see what I'm talking about, go check where the NASDAQ 100 index was when Bitcoin reached a price of 64K during April 2021 and DeFi tokens prices skyrocketed (spoiler alert: way lower than where it is today). It means that a lot of institutions and firms that were investing in BitcoinDeFi during that time are not doing so today, and that a few opportunistic asset management companies, traders and market makers are taking advantage of the average investor's optimism to increase their revenue
-Net income margin compression in the invested companies balance sheets is another factor that is driving them way more likely to realize their profits
-Momentum of INJ relative to Bitcoin has considerably slowed, which means that opportunistic traders are likely to sell and take the opposite position while market makers widen the bid-ask spread to make more profits off the volatility, exacerbating the asymmetry towards the selling activity in the buy/sell ratio
-Transaction Volume declined significantly since INJ reached the 6 months high, along with trend-price covariance which also decreased significantly (meaning they're more divergent) and given the fact that trend follows price, this is STRONG EVIDENCE OF TREND REVERSAL
-One important metric that investors can use to quantify the percentage of the MASSIVE UNDERGOING CORRECTION of INJ 's price, is the concentration of INJ token holdings
-As you can on the token's etherscan page (and in the above picture) the 10 most INJ-rich wallets contain an aggregate amount of tokens that equals to 90% of total held tokens, with just the first two wallets accounting for a whopping 75% of the circulating supply (which is another word for “total held tokens”)
-It means that if just the 2 richest wallets sell all of their tokens, the respective drop in price amounts to 75% from the current level. If you calculate the Gini coefficient using the publicly available data, the result is a value > than 0.9 (using a 0 to 1 scale with decimal intervals) which signifies that the distribution inequality of tokens between market partecipants is far greater than the wealth inequality between citizens of any country in the world (for comparison, the U.S. has the highest Gini index for wealth distribution, at 0.84 or 84%, with 10% of households owning >70% of the country's wealth). In the INJ market, 2 wallets out of 15000 total wallets (0.01%) own 75% of market cap value. In short, THE TWO BIGGEST WALLETS DUMPING THEIR HOLDINGS ALONE CAN BE CATEGORIZED AS A RUG-PULL
-The TOP 10 HOLDERS (which are VC and Private Equity firms) are highly incentivized by the current macroeconomic conditions (as mentioned above) TO DUMP THEIR HOLDINGS WHEN INVESTORS AND TRADERS ARE NO LONGER BUYING THE TOKEN ABOVE MARKET VALUE, and the effect of that event materializing EQUALS TO AN 89.9% CORRECTION in the price of INJ
-THIS EVENT IS ALREADY HAPPENING, and is observable via the CAPITAL FLOWS DATA VISUALIZATIONS (liquidity inflow and outflow, the second being represented as a negative inflow in the charts above) made publicly available by the exchange that is INJ's biggest market (44% of total trading volume). As you can see from the above pictures, the charts SHOW A MASSIVE LIQUIDITY OUTFLOW FROM INJ INTO USDT AND USDC
-The liquidity picture in every major economy in the world is getting uglier by the day
Stay safe.
