Aerodrome Finance Surges 22.34% After Coinbase Partnership

Aerodrome Finance (AERO) experienced a significant surge, reaching a one-month high after successfully defending the $0.5 support level a week prior. The altcoin traded within an ascending channel, peaking at a local high of $0.78. At the time of reporting, AERO was priced at approximately $0.74, marking a 22.34% increase over the last 24 hours. This price movement reignited interest across the market, with 72.79% of AERO holders now "in the money," amounting to about 1.21 billion tokens worth $921 million. Conversely, only 21.41% or 357.11 million AERO remained "out of the money," indicating that the majority of addresses have benefited from the price surge.

The rally was triggered by Aerodrome's announcement of a partnership with Coinbase. According to Aerodrome’s team, the integration of DEXes from the base directly into the main Coinbase app will allow Coinbase users to access and trade millions of assets on-chain. This development was viewed as bullish by many users, leading to increased buying activity. The Buy Volume spiked to 36 million AERO, as shown by Coinalyze data.

However, despite the surge, not all participants are convinced of a sustained rally. Many investors and holders have taken these gains as an opportunity to take profit. Over the past three days, AERO has recorded positive netflows, suggesting that exchanges have seen more inflows than outflows. This implies that as prices continued to rise, more holders turned to profit-realization. A higher exchange inflow can lead to oversupply, causing downward pressure on prices. In derivatives markets, sentiment leaned bearish, with AERO’s Open Interest surging 64.2% to hit an all-time high of $55 million, reflecting increased futures participation. Most of that interest is skewed short, with 56% of positions shorting AERO. The Funding Rates indicated that most of these entering Futures contracts were going short, reflecting strong bearish sentiments.

Moving forward, if the rally is speculative and short-lived, and these sentiments persist, we could see a pullback to $0.67. However, if the good news brings more investors and rising demand, while profit-taking behavior cools down, AERO will close above $0.7. A daily close above here will keep the bullish momentum alive, and we could see a bounce to $0.80.