Ethereum is known as the queen of the market as it pioneered the smart contract and decentralized applications’ technology. However, the older proof-of-work mechanism of Ethereum is cited to become the death of the queen. The bull run of 2021, although, resulted in massive gains for Ethereum. It also made it evident that the queen of the market is not ready for a mass-scale adoption. The network suffered from congestion as well as exorbitantly high gas fees. This led to a shift of focus from Ethereum to other altcoins. One of the projects that has gained a lot of attention is Solana. Solana offers an integrated ecosystem of various DeFi projects which makes it an interesting proposition. One of the offerings of Solana is Raydium.
What is Raydium?
The summer of 2020 is known as the DeFi summer. The decentralized finance sphere exploded and new gaps were identified. The founder of Raydium, AlphaRay, recognized the need for an order book-based AMM and launched Raydium’s mainnet in February 2021.
Raydium is an automated market maker as well as a liquidity provider. The uniqueness of the platform is that it provides on-chain liquidity to a central order book. The central order book belongs to Serum which is a prized project of the Solana ecosystem. Serum is the first decentralized exchange for Solana which makes it crucial for the system. The value of Raydium can be considered to be derived from the role it plays in Serum whose value is dependant upon Solana.
Can RAY go upwards?
The cryptocurrency portrayed phenomenal performance in the bull run of 2021 and the price hasn’t ended yet. Although the market was hit by corrections, Raydium has once again picked up the pace during August. It established a new all-time high at $16.36 during the end of August. At the time of writing, the cryptocurrency stands at a price level of $13.91.
Being a project based on Solana’s blockchain, its success if closely tied with that of Solana – which is an added advantage for Raydium as Solana is one of the most sought-after projects. Solana has an extremely bullish outlook which will boost the future of the decentralized exchange as well. According to the estimates of Digital Coin Price, the cryptocurrency is expected to be trading hands at $21.27 in a year’s time. The price is expected to continue upwards till it reached $49.15 in five years’ time. However, Wallet Investor predicts a fall towards $4 in a year’s time. While the fundamentals support a bullish future outlook, the upcoming days will determine if Raydium is a good investment or not.