Algorand crypto (ALGO) has been in a downward spiral since its November 2021 peak. The streaming blockchain token trades more than 90% below its all time high of $3 reached on November 18. However, the technical set up suggests that the bottom might me in for ALGO and with strong fundamentals such as collaboration with the Nigerian Federal Government Intellectual Property (IP) Exchange Marketplace and Wallet, the price of the altcoin may spike in the near term.
As such, if you are seeking to buy Algorand before the big lift off, read our cryptocurrency guide to get started.
Algorand Collaborates With The Federal Government Of Nigeria
The Algorand Foundation and the Nigerian Federal (FG) has entered a three-year exclusive Intellectual property right (IPR) agreement with Partnership with Koibanx and Developing Africa Group to develop a national; crypto wallet for Nigeria.
The deal gives Developing Africa Group, a regional software development company, the license to blockchain platform for Nigerians to upload all forms of IP rights allowing them to trade, sell or exchange them globally while collecting royalties and proceeds of these operations in their wallets.
Cryptoassets are a highly volatile unregulated investment product. Your capital is at risk.
The Developing Africa Group chose Algorand as the blockchain upon which the protocol will be built and Koinbanx as the tokenization and payments engine to be utilized in the Sub-saharan African country.
The announcement was made on a Twitter space hosted by Fred Estante and co-hosted by Koibanx in May.
BREAKING: @koibanx and @developingafro
to develop #Nigeria's official platform for commercialization of all IP in the country, on #Algorand.As announced by @leoelduayen and @developingafro earlier today on a #TwitterSpace. Replay https://t.co/pGqAc2vp0s
— Algorand (@Algorand) May 23, 2022
“Algorand’s protocol not only provides the performance, scalability, security and functionality required to implement such a large scale project but is also environment-friendly which is important for the Government and has a huge philosophical match with the `creators economy industry´ we’re targeting here,” stated Ben Oguntala, CEO of Developing Africa Group.
This development came after the Securities and Exchange Commission released regulations around Crypto Assets to regulate the market. This is despite the Central Bank of Nigeria blocking the trading of cryptocurrencies in 2021.
As such, the initiative by Developing Africa Group, FG, Algorand and Koinbanx itself speaks to two big facts the crypto industry has been assuming since the beginning. Firstly, crypto adoption and tokenized assets is taking place in “emerging markets” (El Salvador, Nigeria, Central African republic, Colombia, Panamá, Paraguay) at a high rate. Secondly, Latin America and Africa share much more than one can appreciate first hand in terms of socio-economic conditions, demographies, inflationary currencies, crypto adoption, financially sub-attended population and a rapidly increasing smartphone penetration.
These are developments that governments cannot afford to ignore, or indeed do so at their own peril. The best way would be to put in place clear regulations that will enable players to act in a clear regulatory environment. This instills confidence that their investments are safe and protected, in the end, sparking developments in this space.
Algorand price is down 40% since the announcement. However, with these developments still in the pipeline and Algorand’s NFT partnership with FIFA, the price appears to be at a good place to stage a recovery.
Algorand Crypto Price At An Inflection Point
ALGO price was down over 7% in the past seven days, in a sell-off that saw it flip the crucial $0.3 level into a resistance barrier. Although Wednesday’s battle between bears and sellers saw the altcoin rise as high as $0.33, the persistent overhead pressure had pulled it down by 3% to the current level around $0.28.
While the $0.27 level may provide the required support where the buyers may regroup before staging comeback, a rejection from the current level may be detrimental for Algorand “hodlers”.
ALGO/USD Daily Chart
Apart from the four consecutive red candlesticks on the daily chart (above), the downward facing 50-day Simple Moving Average (SMA) suggested that the current market conditions favored Algorand’s downside. In addition, the Relative Strength Index (RSI) was facing downwards and its position at 35 reinforced the bear’s grip on the Algorand crypto price.
Further validating ALGO’s downside was on-chain metrics from IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model. According to their IOMAP chart below, the barrier at $0.33 embraced by the 50-day SMA within the $0.3257 and $0.3332 price range provided a challenging hurdle on the upside. Within this area, approximately 51.88 ALGO were previously bought by roughly 159,260 addresses.
Any attempts to push the price higher than this level would be met by selling pressure from these investors who would like to break even. The resulting headwinds would just push Algorand price lower.
Algorand Crypto IOMAP Chart
On the upside, the technical set up showed that ALGO was trading within an important demand zone stretching from $0.27 to $0.42. This suggested that the selling pressure may soon run out of momentum as buyer congestion from this area could trigger a trend reversal.
Note that Algorand crypto rebounded from this demand area in January 2021 and went on to rally an impressive 300%. If history repeats itself, this support zone may provide a launching pad for ALGO to rise toward the $0.42 barrier. A move higher could see the proof-of-stake token rise above the $0.5 psychological level to the $0.75 range high. Such a move would represent a 158% climb from the current price.
Market participants would, however, have to wait for the price to rise back above the 50-day SMA to trigger an uptrend.
Where To Buy ALGO
If you wish to know how to buy cryptocurrency such as Algorand crypto, you can do so on top exchanges such as eToro, Binance, OKEx, CoinTiger, HitBTC, and ZT. You can find others listed on our crypto exchanges page.
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This article was written for Business 2 Community by Nancy Lubale.
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