The Coinbase Effect: Why Recent Listings Sent Prices Soaring

The Coinbase Effect Explained

Ever heard the phrase, “You are what you eat”? Well, in the ever-crazy world of cryptocurrency, we could easily swap that for “You are where you’re listed.” When a token makes its way onto a popular exchange like Coinbase, it tends to get a boost akin to your friend’s latest workout plan – you can either see them glowing with energy or simply confused why they keep talking about kale. This phenomenon has become known as the ‘Coinbase effect.’

The Stars of the Show: MATIC, SKL, and SUSHI

On March 11, crypto enthusiasts got a treat as three tokens – Polygon (MATIC), SKALE (SKL), and SushiSwap (SUSHI) – were added to the Coinbase list. Spoiler alert: they didn’t just get a warm welcome. They strutted in like they owned the place. With record trading volumes and impressive price movements, these tokens were clearly ready to party.

• SKL: Increase of over 200% since March 9
• MATIC: Growth of 88%
• SUSHI: A modest rise of 7%

Breaking it Down: SKALE’s Scalability

SKALE defines itself as an ‘elastic network’ aimed at enhancing the Ethereum network’s scalability. Think of it as the superhero coming to save us from latency and hefty transaction fees. It’s got a solid pitch: Solidity smart contracts operate “thousands of times faster at a fraction of the mainnet cost.” If that doesn’t sound like a steal, I don’t know what does. This is especially beneficial for gaming and content streaming platforms that struggle with network congestion.

MATIC: The Party Continues

More bubbly than San Pellegrino at a backyard barbecue, MATIC has been on a roll in 2021. With the Coinbase listing as the cherry on top, the token has witnessed a whopping 150% increase since the announcement. March 12 alone broke records with a $2.6 billion trading volume. A shout-out to Cointelegraph’s VORTECS™ data hints this bullish trend had been brewing since March 6. It’s almost like they were warming up for the big dance!

A Quick Look at SUSHI’s Performance

While SUSHI may have had the quietest arrival at the Coinbase party, it’s still relevant. Holding strong with $4.21 billion locked in its protocol, the DEX had already enjoyed a remarkable growth of 675% earlier this year. Yet, it seems everyone was too busy celebrating SKL and MATIC’s gains to notice SUSHI quietly munching on its own success. But don’t count it out just yet – it’s still a force in the DeFi landscape.

The Underlying Themes: Solving Ethereum’s Woes

One connecting dot between these three projects is their dedication to addressing Ethereum’s scalability issues. It’s like each of them brought different appetizers to the potluck, all under the same theme. Sure, the Coinbase effect helped push prices upward, but it’s clear that their capabilities provide solid solutions for the growing demands of the crypto community, keeping them ripe for future growth as the blockchain ecosystem continues to blossom.