Decentral Block Post

Maker has gained 53.5% over the past month, and the cryptocurrency witnessed a remarkable 28.1% surge between July 15 and July 22, achieving its highest daily close in nearly a year. While the gains are impressive, the real question is: Can the cryptocurrency sustain its current trajectory, or were short-term factors behind the price pump?

MakerDAO, the decentralized autonomous organization (DAO) responsible for the Dai (DAI) stablecoin and the governance token Maker (MKR), unveiled a five-phase roadmap in mid-May. Dubbed “Endgame," the upgrade plan includes a new blockchain, a rebrand and the introduction of two tokens featuring updated functionalities.

Rune Christensen, co-founder of MarkerDAO, revealed that the primary component of “Endgame” entails developing incentive programs for interactions and governance participation based on a new chain bridged to the Ethereum network. Essentially, users will have the capacity to initiate hard forks in response to power attacks or abuse.

Ascribing the recent rally solely to these proposed changes seems simplistic, given that Maker’s price remained stable for 30 days after the announcement. Consequently, investors seeking to understand MKR’s movement must delve deeper to identify the precise triggers behind the price surge.

Venture capital funds unload MKR

According to crypto markets and decentralized finance analyst Nay, Paradigm Capital likely divested a significant portion of its MKR investments in March. Furthermore, A16z, another major venture capital firm that previously invested in Maker, has been reducing its position over recent weeks.

Bitcoin (BTC) plunged to $29,000 on July 24, signaling that bears are trying to seize control. It looks like the failure to hold on to the higher levels may have tempted short-term bulls to book profits and aggressive bears to initiate short positions.

Although the near term looks bearish, long-term investors remain unfazed and they continue to hold on to their positions. Glassnode data shows that Bitcoin’s Long-Term Holder Supply made a new high of 14.52 million Bitcoin, “equivalent to 75% of the circulating supply.”

While the cryptocurrency markets have turned soft in the near term, the United States equities markets remain on a strong footing. The Dow Jones Industrial Average has risen for ten straight days, its longest streak since 2017. However, things could change this week with a slew of key earnings reports and the Federal Reserve’s policy decision on July 26. The latter could also impact the U.S. dollar index (DXY), which is on a recovery path.

Could lower levels attract buyers in Bitcoin and select altcoins? Will the strength in the U.S. equities markets limit the downside in the cryptocurrency markets? Let’s analyze the charts to find out.

S&P 500 Index price analysis

The S&P 500 Index (SPX) turned down from 4,578 on July 19 but a positive sign is that the bulls have not given up much ground. This suggests that the buyers are not dumping their positions as they anticipate the uptrend to continue.

XRP (XRP) price is down today, mirroring trends elsewhere in the cryptocurrencymarket as traders await the Federal Reserve rate decision in the week.

XRP price drops amid rising dollar strength

On July 24, XRP price dropped 8% to $0.68, underperforming the crypto market's 3.5% decline on the same day. The XRP/USD pair declined amid growing expectations that the Fed would raise interest rates by 25 basis points in its July 25-26 meeting.

A higher rate environment is considered bad for cryptocurrencies like XRP. As a result, some traders have rotated out of high-cap cryptos to seek shelter in safer assets like the U.S. dollar, selling at the peak of the Ripple-led market rally on July 13.

For instance, XRP's price climbed 75% on July 13 but was unable to extend its gains above $1. Since then, the token's price has fallen by 28%. On the other hand, the U.S. dollar index (DXY) bounced nearly 2% in the same period.

Meanwhile, the correlation coefficient between DXY and XRP was -0.79 on July 24 compared to +0.25 on July 13, showing a greater likelihood of XRP dropping further if the dollar keeps rising in the coming months.