Tezos’ Trajectory is Bearish After the Kathmandu Upgrade Went Live on Mainnet

We will analyze the impact of the recent upgrade on Tezos’ network. After that, we will also look into why Tezos’ trajectory is bearish. First, let’s explore the current outlook of the ecosystem. 

Current Market Outlook

Proof of stake (PoS) based blockchain’s native asset is holding the 41st market position with a daily loss of more than 2%. Currently, Tezos ($XTZ) is trading around $1.50 with a daily trading volume of more than $24 million.  CoinMarketCap reveals that the asset has been bearish for a month with a small recovery on September 11 when the price of the asset reached the $1.72 price mark. The asset is more than 80% down from its all-time high of $9.18. Tezos has not been a network to offer a huge return on investment (ROI) compared to the other assets in the network. 

CoinMarketCap

Tezos Network recently got its 11th protocol upgrade named Kathmandu Protocol. This was Tezos' eleventh update since the platform's launch in 2018, and it holds the promise of possible scalability gains.

Let’s see what changes it will bring to the table for the L-1 blockchain network. 

What Changes Kathmandu Will Bring to the Network?   

The mainnet of the Proof-of-Stake (PoS)-based blockchain Tezos [XTZ] has been updated with a new protocol. The Tezos community was initially presented with the Kathmandu upgrade, which was the eleventh one overall, in July.

Twitter

Nomadic Labs and six other developers claimed that Kathmandu was intended to scale the Layer-one (L1) protocol. Additionally, the difficulties associated with pipeline validation and testnet governance will vanish. Co-founder of Tezos Kathleen Breitman spoke with Bloomberg's Emily Change about the upgrade prior to it taking place. She said that the Tezos network could update more than ten times without experiencing any issues because the protocol was designed to do it automatically.

How Tezos ($TXZ) Price Has Reacted After the Upgrade

Tezos trajectory might have been bearish for the last month. However, things seem to be changing. Since the upgrade activation, XTZ appeared to have responded favorably. The native token of the future's security-focused internet has increased 4.15% during the past 24 hours. XTZ was trading at $1.52 at the time of publication.

Tezos increased in terms of its development activity, as was to be expected. The blockchain's development activity was 0.75, according to Santiment's on-chain analytic tool.

Santiment

After analyzing its network operations, Massari revealed that the volume of transactions had decreased to $9.68 million. Before the current price, XTZ had a seven-day transaction volume of up to $17.30 million.

Messari

The crypto data library suggests that the number of XTZ addresses was getting closer to the bottom. According to the crypto intelligence network, there were already 8,420 addresses with more than $10,000 in XTZ. The number of those with $100,000 XTZ and beyond had fallen to 1,490. The addresses with fewer Tezos units, however, were increasing.

XTZ was not developing, according to data on the Decentralized Finance (DeFi) ecosystem. The Tezos Total Value Locked (TVL) was $24.65 million, according to DeFiLlama. The value today was down 2.21% from the value of the day before. Tezos' market supremacy was also reported by DeFi Llama to be at 69.12%. This demonstrates that the liquidity protocol has given asset holders greater incentives.

What’s Next

The asset is going to test its major support at around $1.42. The recent nosedive of the TXZ has taken it to the 2019 price levels. The idea of the trend reversal is not too far-fetched due to the recent upgrade. The development activity is going to play a critical role in a price rally. 

TradingView

The above image clearly shows that the asset price has been accumulating after a steep fall. Tezos’ trajectory in the coming days is highly dependent on whether the asset can hold the current support levels at $1.42 and $1.21. If $XTZ cannot hold these support levels, we might be heading to the start of the $1 price mark, which is highly unlikely. 

Conclusion

The next few days are very crucial for the XTZ, and with this upgrade, we can expect a recovery. Things will get really ugly if bulls don’t get control of the asset. DYOR!!!