What are Alchemix crypto loans and how did the ALCX token perform?
The crypto-verse is odd, which could be the main factor behind its hyper-volatility. Shortly after it became clear that billionaire Elon Musk was acquiring Twitter, a new coin, Elon Buys Twitter (EBT), emerged.
What else? The price of the EBT token would have jumped in no time, and it might even get a listing on CoinMarketCap.
CoinMarketCap tracks over 19,100 assets, but in the crowded space, it’s mostly the top 100 or 500 assets that make the most noise. Among the top 100 are BTC, SHIB, APE, AXS and others. All coins come with a particular project, which claims to provide a certain service like blockchain gaming.
Let’s talk about a decentralized finance (DeFi) project Alchemix, which is in the top 500 assets.
What are Alchemix “self-repaying” loans?
A DeFi platform, Alchemix claims that it accepts cryptoassets like ETH and USDC as deposits, which generate a return for the depositor. The project mentions “same asset loans” on its official website.
Here, the borrower is said to use their own crypto assets as collateral, against which a “synthetic” version of the token is provided as a loan.
The platform further claims that user deposits are not locked and can be retrieved at any time. It is said to use a mechanism to earn return from deposited assets, but in the white paper there is a mention of “expected value” and “loss”. This ideally requires some due diligence from crypto enthusiasts.
Read also: What are the top NFT gaming tokens by market cap?
What is Alchemix Cryptography (ALCX)?
The Alchemix DeFi protocol uses ALCX as its native token. At the time of writing, the market capitalization of the ALCX token is over US$90 million. Trading volume had surged in the past 24 hours, leading to a slight gain in value.
The ALCX token was trading at nearly $72, which is significantly low compared to the price of nearly $280 on January 1, 2022.
The only noted bull run in the ALCX token this year was during the first half of January, after which there was a continuous decline in value. Moreover, almost a year ago, ALCX was trading above US$1,300.
Read also: What is the Zoro Inu token and its “deflationary” feature?
Data provided by CoinMarketCap.com
At the end of the line
Elon Musk’s takeover of Twitter has spawned a new EBT token, which may even rise in value. This sheds light on why crypto enthusiasts should be careful before making any investment decision.
Alchemist was one of the top 500 perks at the time of writing. It claims to provide loans against crypto collateral. According to the platform, these loans are “self-reimbursable” because the deposited guarantee pays off. The ALCX token lost substantial value both on an annual basis (YTD) and over 1 year.
Read also: What is the Elon Goat token and how is it related to Elon Musk?
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