logo
0
avatar
0x8471...43e1 5C2C49BE-0B07-4C3F-8D36-B1FB2C7ACC0C Created with sketchtool. 15 Stranger 1 Aug 28 2023 14:12

AnkrETH token's status after multichain liquidity collapse and low liquidity on fantom chain

Expert

I'm seeking clarification on the status of the ankrETH token on the Fantom chain in light of the recent multichain liquidity collapse. Was the ankrETH token among the affected tokens, or has it remained unaffected by these events? Furthermore, I've noticed that there is a notable lack of liquidity for ANKR, ankrETH, and even native ankrFTM on the Fantom chain. Could someone shed light on the reasons behind this low liquidity situation?

Answers 1

0
avatar
0x9375...934b 5C2C49BE-0B07-4C3F-8D36-B1FB2C7ACC0C Created with sketchtool. 19 Stranger 1 Aug 29 2023 13:15

The ankrETH token on the Fantom chain was not affected by the multichain liquidity collapse.

The low liquidity for ANKR, ankrETH, and native ankrFTM on the Fantom chain can be attributed to several factors:

  • Different Chain Dynamics: Since Fantom is not the native chain for ANKR, ankrETH, or ankrFTM, the liquidity on Fantom crypto might not mirror the liquidity levels on their respective native chains. Users tend to have more familiarity and trust in trading and staking on the native chains.
  • Market Perception: Tokens that are not native to a particular chain may be perceived as less secure or less established by users. This perception could lead to reduced participation and liquidity on the non-native chain.
  • Cross-Chain Bridge Concerns: The multichain liquidity collapse incident may have raised concerns about cross-chain bridges' security and reliability. Users might be cautious about using bridges to move tokens between chains, impacting liquidity.
  • Network Effects: Established liquidity tends to attract more liquidity. Since these tokens have limited liquidity on Fantom, it might discourage others from providing liquidity due to the potential lack of trading activity.
  • Ecosystem Development: The development of an ecosystem involves building infrastructure, tools, and awareness. If these aspects are less developed on Fantom, it could hinder liquidity provision and trading.
  • Market Performance: If the tokens' performance in the market is not strong, traders and liquidity providers might be less motivated to participate on any chain, including Fantom.
  • Network Effects: Established liquidity tends to attract more liquidity. Since these tokens have limited liquidity on Fantom, it might discourage others from providing liquidity due to the potential lack of trading activity.