What is behind his meteorite rally?

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Alpha Finance Lab’s governance mark, ALPHA, is up 152% over the past week. It is now the 85th most valuable cryptocurrency on the world market and breaks into the top 100 in a short time.

There are three key factors behind the meteorite rally: Alpha Homora’s rapidly rising Total Value Locked (TVL), the overall positive market sentiment regarding decentralized financing and the imminent launch of Alpha Homora V2.

ALPHA / USDT 15-minute price (Binance). Source: TradingView.com

What is ALPHA, Alpha Homora and AlphaX?

Alpha Homora is essentially a protocol that allows users to create a farm using leverage.

The term “yield farming” refers to the process of providing liquidity to DeFi protocols in order to achieve sustainable yield, or APY. Through the use of leverage, Alpha Homora enables users to supply pools with liquidity more efficiently.

Alpha Homora V2 extends the first version with various improvements. In addition to Uniswap, more pool support is added, e.g. B. Curve, Balancer and SushiSwap. In this way, users can benefit from a more varied choice of pools to maintain a farm.

The second version also allows users to hold leverage positions up to nine times, borrow multiple assets, and lend or borrow assets other than Ether (ETH), as Sawit Trisirisatayawong of Band Protocol explained.

Ultimately, Alpha Homora should be useful to the average DeFi user with limited capital who wants to maximize their yields.

AlphaX, the decentralized futures exchange, also aims to be beginner-friendly by removing the manual futures funding rate and branding it into the price. The two key products in the Alpha Finance Lab ecosystem are designed for casual users in DeFi.

With a market capitalization of $ 296 million, ALPHA is arguably a blue-chip DeFi asset. However, the price for ALPHA is very dynamic and rising continuously.

The optimism about ALPHA stems from Alpha Homora’s rapid rise in TVL and the project’s active developer community.

Alpha Homora’s $ 618 million alone could warrant a high valuation for ALPHA by calculating the potential fees the protocol might charge in the future and predicting cash flow.

The existence of other key products like AlphaX that make Alpha a more comprehensive DeFi ecosystem has likely made ALPHA more attractive as a long-term DeFi bet.

The pace of growth is optimistic

Alpha Homora is the fastest DeFi protocol to achieve a TVL of $ 600 million in DeFi space history.

Alpha Homora growth. Source: Alpha

It took about six months for the best DeFi protocols and lending platforms like Aave and Curve to hit the same TVL.

While Alpha was admittedly started when the DeFi room was seeing explosive growth, it’s nonetheless impressive that it was able to outperform the largest projects in the room.

In the long run, there are several potential catalysts for the price of ALPHA.

In particular, Alpha Finance Lab’s official document shows that ALPHA token holders may soon be able to receive some of the protocol fees either through staking or by providing liquidity. The document reads:

“Utility tokens for all Alpha products (e.g. providing liquidity or participation to receive% protocol fees) (not yet implemented).”

More benefits for ALPHA should act as a strong catalyst in the long term and make the token itself more attractive.