Post by linnorm about Raydium ($RAY)

The $RAY token, from the Raydium DEX on Solana, has pushed its market cap to $1.07B. Recent action saw $RAY gain 13.27% over the last month and a remarkable 185.01% in the last three months, though the last week saw a 9.65% bleed. This strong upward momentum for $RAY followed renewed interest in Solana's DeFi ecosystem, with significant liquidity flowing back to its native applications after a period of contraction.

Raydium operates as an AMM and liquidity provider, with its value proposition tied to the volume of trades and the capital deployed within its pools. The current $RAY price sits at $1.9295986634735314. The recent boost in $RAY appears driven by a resurgence of activity on Solana, attracting capital to its core infrastructure, which benefits venues like Raydium directly.

My call on $RAY would be wrong if the general liquidity inflow to Solana-based DeFi stalls or reverses, or if Raydium's share of that capital begins to erode in favor of other venues. We are watching where the money goes when it stops.