SUSHI -4557.03% YTD Amid Protocol Overhaul and Liquidity Challenges

On SEP 1 2025, SUSHI dropped by 251.71% within 24 hours to reach $0.7399, SUSHI dropped by 528.81% within 7 days, dropped by 251.71% within 1 month, and dropped by 4557.03% within 1 year.

The dramatic price correction follows a series of protocol adjustments and governance decisions aimed at restructuring the SushiSwap platform. A key development was the implementation of a token burn mechanism designed to reduce the circulating supply of SUSHI. This move, while intended to bolster scarcity and investor confidence, coincided with heightened liquidity outflows and reduced on-chain activity, which exacerbated downward pressure on the token.

In response to the volatility, the core development team announced a strategic pivot to improve cross-chain interoperability and user onboarding processes. These changes are expected to reduce gas costs and improve overall usability, but they have yet to translate into market confidence. The token has seen sustained outflows from key liquidity pools, with a sharp reduction in TVL (total value locked) across multiple supported chains.

From a technical standpoint, SUSHI’s price action has shown a breakdown below key support levels, with the 200-day moving average acting as a resistance barrier. The Relative Strength Index (RSI) has remained in oversold territory for an extended period, indicating potential exhaustion among short sellers. However, without a definitive reversal pattern or a catalyst for renewed demand, the bearish momentum is expected to persist in the near term.

Backtest Hypothesis

A proposed backtesting strategy evaluates the effectiveness of a trading signal based on RSI divergence and the 200-day moving average. The strategy involves entering short positions when RSI indicates overbought conditions and the price crosses below the 200-day MA. Exit signals are triggered by either a 10% stop loss or a 20% target gain. Historical performance metrics would assess the viability of this approach under varying market conditions.