STEEM is at pump phase ahead of the hard fork; the token gains over 183%
- An upcoming hard fork drives STEEM to new highs.
- The coin is vulnerable to sell-off once the fork is over.
STEEM's chart looks crazy, especially in the current environment of cautiously pessimistic uncertainty. The token jumped by 183% in recent 24 hours and hit the intraday high at $0.4479, which is the highest level since April 2019. At the time of writing, STEEM is changing hands at $0.3785 and the upside momentum remains strong.
The coin takes the 38th place in the global cryptocurrency rating with the current market value of $131 billion. The average daily trading volume of the coin exceeded $100 million, while in the long-run this figure was close to 1 million.
Why fork?
STEEM is a native token of the same-name blogging platform where users get rewards depending on the popularity of their content. The severe pump of the coin is caused by the upcoming hard fork that will take place on Friday, March 20, and result in creating two separate blockchains. The fork is activated by community members to resist the attempts of TRON's founder Justin Sun to seize control over the ecosystem.
Steem users will migrate to Hive.io blockchain together with all the existing data and decentralized applications, except for the tokens controlled by the development fund Steemit that entered a strategic partnership with Tron Foundation.
The intention of this community-driven fork is to support and build on the strong Steem community values that have made our ecosystem so diverse and exciting. This new direction steps away from the burden of the Steemit Inc. ninja-mined stake, which has impacted the long term ability to work towards further development and decentralization for years.
According to the announcement, all valid accounts on the Steem blockchain will receive an airdrop on Hive. Some large cryptocurrency exchanges, including Binance and Huobi, announced support for the airdrop, which triggered an eye-popping rally of STEEM price.
Dump will follow
The price pump is quite typical before the forks that are accompanied by airdrops. Users try to accumulate the coins ahead of the event to get free tokens. However, it is always a double-edged sword situation as the price might start collapsing, once the fork is over.
From the technical point of view, STEEM is grossly overbought now. Once the correction starts, the price may retest $0.3000 ( the upper line of the daily Bollinger Band) and potentially retreat to $0.2000 (SMA50 daily).
STEEM/USD daily chart
Author
Tanya Abrosimova
Independent Analyst
