Redemptions, open positions and liquidations of shorts
According to the data, YES.
Yesterday, the official LAB page on X (formerly Twitter) announced the launch of a buyback program aimed at solving three main problems.
The data showed that protocol fees worth $3.401 million were used to redeem a total of 22.644 million LAB tokens. The team viewed this move as converting ecosystem revenue into market demand.
This program is expected to maintain constant purchasing pressure and, therefore, value growth. Furthermore, this is expected to advance long-term resilience for ecosystem sustainability, as well as achieve balanced tokenomics. This would be done by distributing LAB tokens via community incentives to improve healthy token circulation.
This buyback program influenced an increase in business activity. Open positions have increased significantly on different exchanges, especially for small investors.
This was evident when funding rates on several exchanges turned green – a sign of buyer dominance. In fact, most Open Interest (OI) rose by double digits. On Binance, for example, it increased by 21.83% to $155 million.
Short liquidations over the past 24 hours exceeded $17 million across all exchanges. The largest liquidations took place on Bybit, Binance and OKX respectively.
On top of that, there also seemed to be a symbolic demand. This was evident with a Long/Short ratio above 1, except on the KuCoin exchange.
This activity took place against the backdrop of massive demand in the futures market that recently triggered a 16% rally.
The LAB rally is gaining momentum
On the charts, LAB price advanced and reached an all-time high of $20 after today’s rally. The altcoin has seen high volatility lately, as seen by the Bollinger Bands (BB) expanding to maximum levels.
However, the Chaikin Money Flow (CMF) appeared to be between 0.22 and 0.23. This value suggests positive capital inflows, but it is minimal since the indicator does not increase.
At the time of writing, the altcoin rally continued to gain momentum with 12 consecutive 4-hour green candles. This momentum has been supported by the fact that the price is far from the BB mid-level.
Here, it is worth noting the dropoff between $19 and $20 over the last three sessions. This may hint at a potential correction, in which LAB could return to around $16 or lower.
Simply put, the buyback program has so far generated some confidence because it addresses one of the biggest concerns in the market: Balanced LAB tokenomics.
Final Summary
- LAB rose over 40% in one day to hit a new all-time high of $20 after launching a buyback program.
- LAB’s 12 consecutive green candles hinted at buyer momentum, but a continued break between $19 and $20 could suggest an impending correction.
