Aster [ASTER] has traded within a parallel consolidation range since it failed to flip $0.76 nearly a month ago. The altcoin has remained stuck between $0.65 and $0.76, indicating a market stuck at a decision point.
In fact, as of this writing, ASTER traded at $0.702, up 2.37%, after rebounding from a $0.67 slip on the daily charts. With the altcoin struggling to break out of this range, the team has attempted to absorb some downside pressure.
Aster removes 911K tokens from circulation
The Aster team continued to implement deflationary measures to avoid further downside pressure.
According to Aster-Dex, 455,982.11 tokens have been permanently burned, and 455,982.11 ASTER have been transferred to the Treasury Contract.
These tokens are a part of Aster’s Airdrop Stage 5 distribution. After the latest burn, it has eliminated a total of $123.63 million in tokens from circulation.
Typically, increased token burns reduce the circulating supply, making an asset scarcer. If demand for the same rises or holds steady, prices can rise, largely driven by supply and demand dynamics.
Coupled with that, the team has continued token buybacks and is now in season 6. So far, the team has spent $7.6 million and has bought back 12.2 million tokens.
In total, the team has bought back 266.3 million tokens worth $187 million, further reducing supply and rising scarcity.
Token burns and buybacks, combined, significantly reduce supply, thereby absorbing any rising sell-side pressure.
Any impact on price momentum?
Token buybacks and burns have offered ASTER short-term relief in the past, helping the altcoin make some gains. The same case was witnessed on intraday charts as it reclaimed $0.7 levels.
As a result, the altcoin flipped its short-term 20- and 50-EMAs at $0.697 and $0.698, respectively, indicating short-term momentum.
At the same time, the Relative Strength Index (RSI) jumped from 48 to 52, edging into the bullish zone.
However, the RSI failed to make a bullish crossover, suggesting the conflicting forces in the market.
To validate this bullish outlook, the RSI must cross above the signal line, which will strengthen its action and target EMA200 at $0.79.
However, if these gains turn short-term, driven only by recent burns, the altcoin will continue trading sideways, with $0.66 as support.
Perpetuals signal declining risk-averse sentiment
Besides the team’s deflationary measures, demand for derivatives remained steady, helping ASTER to hold within a narrow margin despite a market-wide crash.
In fact, the altcoins’ derivatives have recorded sustained capital inflow. According to Defillama data, ASTER’s Perps Volume has stabilized above $2 billion for the past three weeks, now holding around $2.25 billion.
At the same time, its Open Interest also held strong between $1.8 billion and $2 billion, currently sitting around $2.1 billion. When Perps volume and OI rise together, it indicates increased participation and capital inflows.
Historically, elevated risk appetite has played a key role in driving prices up, as speculative demand tends to accelerate upside momentum.
Final Summary
- Aster-Dex eliminated 911k ASTER tokens, burning 455,982.11 ASTER while 455,982.11 ASTER was transferred to the Aster Treasury Contract.
- ASTER continued to trade sideways, hiking 2%, boosted by the latest burns and recovering risk appetite.
