IOTA, a promising cryptocurrency, experienced a sharp decline following the much-anticipated rollout of its Rebased update. Explore the reasons behind this drop and discover investment opportunities amidst the turmoil.
Despite the many features introduced by the Rebased update, such as smart contracts, staking, and decentralization, the price of IOTA has dropped significantly in recent weeks.
The token has indeed dropped 41% from its peak this year, hitting $0.15 – its lowest level since April 2020. This 75% drop from its November 2024 peaks comes amidst a general decline in altcoins.
One of the main goals of the Rebased update was to attract new developers and expedite the development of decentralized applications on the IOTA network. Despite promising technical features like a processing capacity of over 50,000 transactions per second and finality in less than a second, the results have been disappointing so far.
Third-party data shows that developer activity on IOTA has remained low since the rollout of Rebased. Only one decentralized application (dApp) is currently listed on DeFi Llama, with $9.76 million locked in. In comparison, recently launched chains like Unichain and Sonic have already attracted dozens of developers and millions of dollars in assets.
Furthermore, activity indicators on the IOTA network, such as the number of transactions and active addresses, have remained low. The number of transactions over 30 days has plummeted by 86% to only 621,100, while the number of active addresses stood at 8,376.
Despite this downward trend, IOTA still presents interesting prospects for investors. Its staking pools have accumulated over $334 million in assets, resulting in a 45% staking ratio. These investors are earning an annual yield of 13.47%, which exceeds the average of layer 1 and 2 chains.
From a technical standpoint, IOTA also appears to be approaching a reversal. The token has formed a double bottom pattern at $0.1315 with a neckline at $0.2746, considered a bullish signal. Additionally, a descending wedge pattern indicates a likely breakout if IOTA remains above the double bottom level.
Despite the significant drop in IOTA’s price after the Rebased update, this cryptocurrency seems to offer interesting opportunities for patient investors. With high staking returns and positive technical signals, IOTA could bounce back despite current challenges in developer adoption. Informed investors will closely monitor the evolution of this cryptocurrency in the coming months.
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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