Injective price flies as the new INJ 3.0 era starts

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The Injective blockchain, backed by venture capital funding and classified as a layer-1 chain, persisted in its upward trajectory following the approval by the community for the latest Injective 3.0 update.

Over the past six days, I’ve witnessed a remarkable increase in my Injective (INJ) investment. Yesterday, it peaked at an intraday high of $26, a level not seen since December 18. Remarkably, this token has soared by a significant 40% from its lowest point this year. This upward trend has certainly injected some optimism into my crypto portfolio!

The event’s main catalyst stems from a recent community decision to move from Injective 2.0 to Injective 3.0. This transition is set to unveil novel deflationary elements.

The proposal for the governance of $INJ 3.0 has been successfully approved by an overwhelming majority (99.99%) of community members who voted YES. Now, this new phase is activated, which significantly decreases the token supply, making INJ one of the most deflationary assets in the long run.

— Injective 🥷 (@injective) January 5, 2025

The update will modify the number of tokens in circulation according to how much INJ is being staked, allowing for immediate response to staking actions. This adjustment is anticipated to significantly increase the deflation rate by four times, thereby enhancing Injective’s ability to withstand inflationary forces.

As we move towards a more deflationary system, it’s expected that the staking returns for Injective (INJ) holders will likely grow significantly. At present, Injective offers one of the highest staking yields among cryptocurrencies, sitting at approximately 10.68%, with a staking ratio of 56%. This is considerably higher than Ethereum (ETH), which currently provides a 3.13% yield, and Solana (SOL) and Sui (SUI), offering yields of 7.06% and 2.81%, respectively.

The price surge was observed in the injective network as the total value locked within its DeFi ecosystem surpassed $55.95 million – a level not seen since June of the previous year. The significant growth can largely be attributed to prominent dApps such as Hydro, Helix, Neptune Finance, and DojoSwap. However, it’s important to note that the stablecoin market cap is only around $30 million.

Despite having high-profile supporters such as billionaire investor Mark Cuban, Injective hasn’t been successful in capturing the interest of developers within its network. Conversely, emerging layer-1 and layer-2 networks like Sui, Aptos, and Base have garnered significant investments totaling billions of dollars, attracting developers to their respective ecosystems.

Injective price analysis

Over the past few days, the 4-hour chart indicates that INJ has experienced a significant upward swing. This resurgence started when the token hit its lowest point at $18.42 on December 16th. Since then, it has surpassed the crucial resistance level at $23.80, which is known as the neckline, and crossed the Woodie pivot point at that same price.

The Price Oscillator Percentage has crossed above the zero line, suggesting a surge in positive market momentum. Consequently, INJ may likely keep increasing, and traders are aiming for the initial resistance level at $29. This level coincides well with the 61.8% Fibonacci retracement point, which is approximately $28.87.

If the price falls slightly below the pivot point at $23.80, it could contradict the optimistic perspective and hint at a possible continuation of the downtrend.

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2025-01-06 17:26