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bonk
Bonk (BONK)
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bitcoin
Bitcoin (BITCOIN)
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ethereum
Ethereum (ETHEREUM)
$2,406 -4.27%
binancecoin
BNB (BINANCECOIN)
$639.53 -0.27%
solana
Solana (SOLANA)
$137.17 -4.94%
ripple
XRP (RIPPLE)
$2.09 -3.40%
shiba-inu
Shiba Inu (SHIBA-INU)
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pepe
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bonk
Bonk (BONK)
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Stacks Price Analysis – Why STX Could Rally Back to Over $3 Soon

Highlights:

  • Stacks is consolidating between $1 and $0.52 
  • Momentum is increasingly pushing Stacks higher, putting $1 in focus
  • Improving regulatory environment likely to send Stacks to new highs 

Stacks is gaining upside momentum intraday. When going to press, Stacks was trading at $0.645, up by 4.94%. Stacks trading volumes are also up by a similar percentage to $994.34 million. The rising volumes alongside rising prices indicate that bullish sentiment is building up. Investors are buying amid rising prices, expecting the prices to go even further. Such expectations around Stacks are not far-fetched. Multiple factors support a Stacks price rally, which could see it outperforming the average altcoin in the short term.

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Stacks Has A Mismatch Between Price and Fundamentals

One of the factors that supports the rising bullish sentiment around Stacks is the fact that it is undervalued. Last year, at the peak of the altcoin rally, Stacks was trading at upwards of $3. It has since experienced a significant correction to its current price range of $0.60 to $0.65. This correction was not informed by any adverse change in fundamentals for Stacks. As such, from a purely fundamental perspective, Stacks is massively undervalued. Even better is that Stacks’ fundamentals have become better than when it rallied to $3. 

Proposed SEC Rules Set to Attract Developers to Stacks

Back when Stacks was trading at $3+, there was no clarity on the future of DeFi in the US. This clarity has come when Stacks is trading at prices below $0.70. Recently, the SEC chairman, Paul Atkins, stated that they were working on rule changes that would make it easier for DeFi to thrive. Among the proposed changes is to clarify that deploying code does not equal issuing a security. The change also looks to enforce cryptocurrency self-custody, eliminating regulatory handles that necessitate the use of intermediary custodians. These proposed changes are likely to impact Stacks positively.

Stacks heavily depends on developer activity on its network for the price to increase. Now that the law is set to exempt builders from legal liability for open-source applications, the odds are high that DeFi developers will have more incentive to build. This could trigger a spike in Dapps running on the Stacks network. By extension, this means a surge in demand for the STX token, which could reflect in a parabolic price rally. 

A Pro-DeFi SEC Makes Building on Bitcoin Attractive – Bullish for Stacks

The SEC’s incentive for DeFi developers is particularly a boost for Stacks because it is built on the Bitcoin network. This network is more conservative than the other networks, where developers can run Dapps. As such, someone who initially hesitated to leverage Stacks and build on Bitcoin now has the incentive. The odds of institutions starting to develop large-scale applications on the Stacks network are now high, a fact that could rocket its price to unprecedented levels.

Stacks Price Relationship Makes Rally Through $1 Plausible

Besides its growing fundamentals, Stacks benefits from its price relationship with Bitcoin. When Bitcoin goes down, Stacks tends to drop harder. The inverse is also true, and when Bitcoin is bullish, Stacks tends to outperform. Under current market conditions, Bitcoin appears to be prepping for a rally to new highs. This is evident in how it has weathered geopolitical uncertainty and the rising institutional adoption. This is a hint that a rally to new highs could come soon. By extension, this could mean Stacks is also about to enter a parabolic bull market.

Technical Analysis – Stacks Consolidation Hints At Possible Breakout

After months in the red, Stacks is consolidating between $0.52 support and $1 resistance. With bullish sentiment rising across the market, Stacks will likely target $1 in the short term.

Stacks Price Analysis – Why STX Could Rally Back to Over $3 Soon
Source: TradingView

Pushing through $1 could see Stacks quickly retest the 2024 high of $3.8. The improving regulatory climate in the US makes such a possibility plausible.

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