Optimism (OP) hits 13% in 7 days despite high profile DeFi hack

Amid the ever-changing cryptocurrency landscape, Optimism (OP) has shown remarkable resilience, posting a notable price increase of 13.53% over the past seven days. Despite a slight decline of 1.80% in the past 24 hours and a further contraction of 1.35% within the hour, optimism remains on an upward trajectory.

With the current price at $1.68 per OP and still 48.38% below its all-time high of $3.26, traders and investors are eager to find out the reasons behind its recent gains. This article explores the factors that have contributed to the recent rise in optimism and analyzes its prospects.

The price of optimism (OP) has seen a steady rise over the past week: Source @Tradingview
Optimism (OP) price has seen a steady rise over the past week: Source @Tradingview

High-level hack could block optimism’s bullish trajectory (OP)

Optimism’s positive trajectory took an unexpected turn when Coinbase’s new BASE network, built on the Optimism stack, fell victim to a backdoor contract exploit. This unfortunate event resulted in the loss of 597 Ether, equivalent to approximately $1 million.

The exploit involved infiltrating a backdoor contract on the BASE chain, which allowed the continuous minting of tokens which were then sold for profit. The exploiters managed to mint 40 different tokens, generating a large profit, which was then moved out of the perpetrators’ address.

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As BASE anchors the OP stack, there are concerns that the recent exploit could impact all associated protocols, including the Optimism Network. Additionally, the hype surrounding BASE had drawn several new addresses to the Optimism Network, which potentially dampened investor sentiment and subsequently impacted OP’s price.

The number of active addresses on the Optimism network increased after the launch of BASE in late February. However, the recent hack could put a brake on this growth, as investors may be cautious in the wake of the exploit.

Will the Bulls sustain the impressive rally?

Despite BASE’s recent feat, Optimism (OP) has managed to maintain a sense of optimism in the market. The OP/USD daily chart is showing promising signs of bullish momentum, with bulls breaking through critical support levels. The short green candlesticks formed above the $1.631 support level indicate the resilience of the market and its determination to keep the price afloat despite the challenges posed by the recent exploit.

Technical indicators further reinforce the bullish outlook for Optimism. THE Moving Average Convergence/Divergence (MACD) remains above the signal line, characterized by green histogram bars that signify the bullish momentum of the asset. Additionally, the Relative Strength Index (RSI) has entered the overbought region, reaching a value of 75. This suggests a considerable increase in buying pressure on OP as investors show confidence in the potential to future growth of the token.

Related Reading: Coinbase Research Expert decodes the latest trends in the crypto and finance market

However, while market sentiment remains positive, traders and investors should exercise caution. The recent BASE exploit has raised concerns about the potential impact on Optimism’s network and the broader sentiment surrounding the token.

The cryptocurrency market is notorious for its volatility, and external events can have significant implications for token prices. It is crucial that market participants closely monitor developments related to the exploit and assess the potential consequences on the price trajectory of Optimism. Despite the positive indicators and bullish momentum, staying informed and vigilant in a rapidly changing market is essential to making informed decisions.

(The content of this site should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image of iStockgraph of TradingView

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