Why is UMA Price Up Today?

January 23, 2024

Decentralized financial derivatives protocol UMA has seen its native token UMA surge over 20% in the last 24 hours to over $6.50. The move comes as derivatives activity on UMA spikes ahead of its expected Oval update aimed at mitigating Maximal Extractable Value (MEV) issues.

UMA has rallied from around $5.00 to current levels of $6.50 in the past day, notching a gain of over 20% amid very strong momentum.

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Driving upside appears to be building speculation ahead of UMA’s upcoming Oval update, which intends to protect lending protocols from MEV extraction risks. According to statistics from Coinglass, open interest on UMA has swelled to over $121 million in the past day, rising 42% in just 24 hours.

UMA co-founder Hart Lambur hinted that the Oval update rollout could come as early as this week. While details remain scarce, the potential MEV solution combined with the parabolic growth in UMA derivatives activity suggests traders are positioning for a bullish breakout.

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In the past week alone, UMA has seen truly explosive price action, vaulting over 200% off the swing low around $2.15. The altcoin now faces initial resistance around the $6.90 level, with potentially more upside on a successful and impactful Oval update.

Still, the fervent derivatives speculation signals traders see further upside potential as UMA looks to mitigate pernicious MEV risks.

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