The Mirror Protocol has done relatively well in the past few days as investors rush to buy the dip. MIR, its natve token, is trading at $0.40, which is about 115% above the lowest level this month. As a result, its total market cap has risen to just $35 million.
Why is MIR rebounding?
The Mirror Protocol is an important decentralized platform built on the Terra ecosystem. The platform’s goal is to enable people to buy and sell synthetic assets like stocks, commodities, and forex.
Like all platforms built on Terra’s network, the coin’s price declined sharply this month. At its lowest point this month, MIR was down by almost 100%.
Now, the cryptocurrency is bouncing back as other Terra coins recover. For example, TerraUSD, the stablecoin that caused all this damage, has risen by more than 10% in the past 24 hours. Similarly, tokens like Anchor Protocol and LUNA have all done well as investors buy the dip.
Analysts believe that some platforms like Mirror and Anchor Protocol will rebuild, possibly in other chains like Ethereum and Solana. They will also likely change their business model to bring in more transparency an focus on other asset-backed stablecoins like USD Coin and Tether.
However, for now, it is relatively difficult to recommend Mirror Protocol as an investment because of the relatively high risks. Like other Terra platforms, it is hard to know whether the recovery plans proposed by the leaders will become successful.
Worse, Mirror Protocol developers have not communicated about how they plan to salvage the project. Their last tweet was on May 4th before the implosion happened.
Mirror Protocol price prediction
On the daily chart, we see that the MIR price has been in a spectacular decline in the past few months. The coin’s sell-off accelerated when it moved below the important support level at $1.090, which was the lowest level on February 25th.
Mirror Protocol price also crashed below the 25-day and 50-day moving averages. Therefore, despite this rebound, there is a likelihood that the coin’s price will continue falling as bears target the next key support level at $0.19.
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