Hello Earth Citizen, welcome to this week's Token Analysis!
A member of the IBC Gang
Juno is a smart contract blockchain that is part of the Cosmos ecosystem. Thanks to the Inter Blockchain Communication (IBC) protocol, it is highly interoperable with other chains, making it easy to bridge tokens and data.
The founders of Cosmos created the IBC protocol because they believe that blockchains that work together can scale further and have more utility than single chains competing against each other. The advantage of connecting chains is that you can create blockchains specialised for a specific use case that other chains can utilise. The entire network of blockchains is also more scalable because the different chains can offload some computations to each other. With IBC, blockchains are not competing but profiting from other chains.
The Cosmos Hub was the first Cosmos SDK blockchain to use the IBC protocol. Technically, the Cosmos Hub does not enable Smart Contracts to be run on the network, as this is an application-specific blockchain for connecting other chains through IBC, with the long-term vision of functioning like a Port City. For now there's a DEX on the Cosmos Hub and an interface to this called Emeris. Some people believe the Hub shouldn’t have more applications, to preserve its neutrality within the Cosmos Internet of Blockchains. That’s why Juno was founded, to offer a general-purpose smart contracts chain on which all types of dApps can be built.
Juno instantly gained popularity thanks to its airdrop that rewarded ATOM stakers with 47% of the initial supply of JUNO coins. Most other new chains in the IBC protocol are also airdropping their new coins to ATOM, OSMO and JUNO stakers because they support these chains and believe that they bring value to their project.
The blockchain is already offering its decentralised exchange called JunoSwap, and many more dApps are being built, many of them doing airdrops to JUNO stakers.
Ethereum and similar smart contract chains face problems beyond high fees and low scalability, in that it can be challenging to bridge assets and data with other chains. Juno certainly doesn’t have that problem, and it could grow to be a core project of the entire Cosmos ecosystem. However, the high interoperability also lowers the demand for a chain that runs decentralised applications in general because each connected chain can specialise in a use case that other chains can use. Still, maybe it can be beneficial to use a chain like Juno as a middle-ground.
$JUNO is the native cryptocurrency of the Juno blockchain. It is used to pay for network fees, governance and staking to secure the chain. Staking the coin is also very likely to be rewarded with airdrops from other blockchains of the Cosmos ecosystem. Still, there is no guarantee for that, and the exact qualifications for receiving an airdrop are different for each project.
There is a max supply of 185,562,268 JUNO, but the total supply will only be circulating after 12 years. The initial supply was 64,903,242 JUNO, 47.24% was airdropped to long-term ATOM stakers, 30.82% was put in a Community pool that the coin holders control and the remaining 21.94% is used for further development and the core developers. The funds for the developers are being vested for the next 12 years. The supply is mostly controlled by people who secured the Cosmos blockchain for a long time, which means that most people who agree with the vision of interoperability govern the Juno blockchain.
$JUNO was made to be distributed to the community. Yes, the very famous airdrop. If you were an Atom staker, you had this airdrop, and you could stake your very new Juno coins directly!
Nearly 50% of the Genesys supply was distributed to the community – a huge rate, which not all projects are doing!
Zooming in on staking activity for $JUNO
Staking is locking up a digital asset non-custodially ($JUNO in the case of the Juno Network) to provide economic security to a public blockchain.
⚪️ Secure the network: With $JUNO, you have the power to contribute to the security and governance of the Juno Network through staking and voting on governance proposals.
⚪️ Earn rewards - By staking to a validator, you contribute to the network's security and are rewarded with $JUNO through staking rewards.
⚪️ Vote for the future - Staking $JUNO grants the wallet owner the right to vote on governance proposals and contribute to making decisions on the future and direction of the network.
Where do rewards come from? Staking rewards are distributed to staked $JUNO in two ways:
- Transaction fees - transaction fees collected on the Juno Network are distributed to staked $JUNO.
- Newly created $JUNO - increasing supply through the network inflation mechanism, are distributed to $JUNO stakers each block over the first 12 years of the Juno Network operation.
You can learn more about the future of the rewards and how it’ll go in time here! Note that in 12 years, the total supply will be issued, and only the swap fees will be distributed to the stakers and validators.
$JUNO Technical Review:
All prices shown are as of 30/03/2021 at 22:00 UTC+2
From a long-term (Weekly chart) point of view, $JUNO is in a retracement period.
After a few months of soaring to the moon, prices have entered a correction phase, which can only be beneficial over the long term.
From a Weekly point of view, prices are supported by the 50% Level with the Fibonacci Retracement tool.
Currently, the 50% is brilliantly holding prices, and we can think that we could go way lower if it breaks.
If we look at Ichimoku, the token is young, and we don’t have much information. However, we have the initial information given by the Weekly Kijun, which also holds prices. This confirms that $USD 26.5 is a solid level to hold, hoping for a bounce if it occurs.
Daily chart: turning bearish?
On a daily chart, this is pretty complicated:
Technically, $JUNO is turning bearish for at least a few weeks. Prices broke the Daily Cloud, and Lagging Span dropped below its Daily Kijun. Daily Tenkan also drives prices and doesn’t give a possible bullish bounce.
The 50% support is currently a precise area that bulls are trying to defend, but according to Ichimoku, we’re bearish until $USD 29.85 is broken, the flat of the Daily SSB.
The last bottom, at $USD 24.9, could be an opportunity to build a Double bottom pattern; who knows?
Anyway, if the 50% support breaks, the next target is $USD 21.92.
$JUNO has excellent potential to serve as a general-purpose smart contracts blockchain that is connected to the Internet of Blockchains. It has revolutionised the industry in the way that ownership was distributed through a massive airdrop, and in how its future evolution will be governed in a decentralised way.
This offers lessons in how future blockchains and Web3 projects could be bootstrapped, including for ReFi applications, to quickly build large stakeholder communities, economic value, and decentralised governance. There's certainly opportunities to futher explore how to include new stakeholders in the Tokenised Earth Economy.
Until next week, stay safe in the markets!
Not financial or tax advice. This article is striclty educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. For tax advice talk to your accountant.DYOR – do your own research.