Interoperability is a driving theme in the crypto market. As the blockchain ecosystem develops into an interconnected web with layer-one protocols and layers, the importance and efficiency of communication among decentralized apps (dApps), will also increase.
Ren (REN), a protocol that allows for interoperability between blockchain platforms, has gained momentum over the past month. This is in line with the increase in activity within the Decentralized Finance (DeFi) sector.
Cointelegraph Markets Pro and TradingView data show that REN prices have risen 185% since Aug. 9 when they were at their lowest point of $00.41. On Sept. 15, the price rose to $1.16 per day. The 24-hour trading volume of REN jumped 443% to $673million.
1-day chart REN/USDT Source: TradingView
The three main reasons for the price increase in REN are the steadily rising activity and total value of RenVM, the launch a bridge to Arbitrum, and the release RenVM Greycore on REN’s testnet.
Locked volume and total value increases
Bullish momentum in REN can be seen in the data for total network volume (TVL) and total value locked.
Ren. Source: Ren Project
As 2021 progressed new chains were added, including Ethereum, Binance Smart Chains, Solana and Polygon.
Each bridge has contributed to increasing the TVL and volume on Ren’s network. This has been in line with the moves made in REN p.
The Bridge to Arbitrum influences the REN price
The Sept. 15 price spike was due in large part to the Arbitrum bridge. This layer-two scaling solution Arbitrum (ETH) is designed to host popular decentralized apps in a fast and low-fee environment.
Many users have had to pay high fees and wait for transactions, which has hampered their ability to use DeFi (or non-fungible tokens (NFT), related protocols on Ethereum.
Arbitrum’s low cost environment has been an attractive DeFi environment to BTC holders, who can now migrate to layer-two and interact with renBTC on the network.
As of September 15, the total value of Arbitrum via Ren Protocol was $7.75million. This figure is shown by the green line in our value locked chart.
Similar: Solana, Arbitrum are offline while Ethereum is under attack
REN moves toward decentralization
The release of RenVM Greycore on the testnet on September 13th was a third reason for the increased activity in REN. This was done to help the project work towards its goal of total decentralization.
Greycore, a semi-decentralized validator group of nodes operated by respected DeFi projects, adds an extra layer of protection to the protocol.
BadgerDAO was the first project to join Greycore, and it is a DeFi project that focuses on building projects that convert BTC into DeFi.
Cointelegraph Markets Pro data shows that the market conditions have been favorable for REN for some time.
Cointelegraph’s exclusive VORTECS(tm), Score is an algorithmic comparison between historical and current market conditions. It is derived from a combination data points, including trading volume, market sentiment and recent price movements, as well as Twitter activity.
VORTECS(tm), Score (green) vs. the REN price. Source: Cointelegraph Markets Pro
The chart shows that the VORTECS(tm), Score for REN changed to green on September 13th and climbed to a peak of 71 on September 14th. This was just as the price rose 72% in the following two days.
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