The KuCoin token (KCS) has declined heavily over the past 7 days, trading in the red zone at press time. The token had joined the downtrend in the entire crypto market following the FTX explosion. However, exchanges such as KuCoin could benefit from the recent failure of the FTX collapse.
KuCoin CEO Johnny Lew, reassured consumers After the bankruptcy of FTX that the exchange would never misappropriate user funds and would be transparent. Lew’s call for transparency was the main catalyst behind the coin’s recent rally. KuCoin has publicly stated that Merkle Proof-of-Reserve will be available in a month.
KuCoin CEO believes proof-of-reserve will re-establish user trust in centralized exchanges
KuCoin CEO Johnny Liu was the first to announce ‘Proof of Reserve’ after the FTX token FTT/USD disaster. Lue said the ‘Proof of Reserves’ is a direct response to user concerns about being out of their cash, with some exchanges restricting withdrawals. According to the CEO, the exchange will release its Proof of Reserve data in four weeks. They believe the report will reassure customers that their money is safe. Lew also said that the data would support his claim that the company has enough cash to pay for the massive withdrawals.
Lew says the current market situation is like a “growing disease”. He attributes this to the sharp decline in the value of the cryptocurrency. Within days, the total market capitalization of cryptocurrencies dropped from $1 trillion to $873 billion. “It is painful to see innocent users getting hurt,” he said, acknowledging that traders will need time to trust crypto exchanges again.
What is the Market Outlook for KuCoin Token (KCS)
Global cryptocurrency markets are struggling, after losing 0.72% over the past 24-hours. The global market volume also declined by 1.35% during this period. Despite these improvements, the global market capitalization is still less than $900 billion. This indicates that most cryptocurrencies are yet to recover from the significant declines they experienced over the weekend. At the time of writing, BTC is down over 5%, while ETH is up 1.09% on the week-to-date.
KuCoin is also down 2.94% on the day. However, it is 1h bullish on the charts, and we can see the coin trade turning green in the coming days. During this period, there has been significant price volatility, as the coin’s value has fluctuated between $7.45 and $8.29. The price chart for KuCoin clearly shows an upward trend as investors rushed to cash in on its recent price increase. If the coin sustains, KCS will make one more attempt to rise above the resistance level of $8.29. It could break above $8.75 and maybe $9.
With an RSI reading of 51, it is clear that the bears are fighting the buying pressure. However, the price volatility is looking bullish, indicating more upside potential. However, there is still a long way to go before most coins recover their weekend losses. This indicates a possible retracement that could send KCS back to the $7.50 support level.
Featured image from Pixabay and chart from TradingView.com