Key Takeaways:
- Crypto.com doubled its trading volume in a week, after the Staples Center name-right deal.
- CRO followed with a 100% rally, however flashed bearish warnings.
YEREVAN (CoinChapter.com) – Cryptocurrency exchange Crypto.com struck gold when it signed a deal with Anschutz Entertainment Group (AEG) on Nov 16 and bought the naming rights to the iconic Staples Center in LA. Now the Crypto.com Arena, home of the LA Lakers, has brought substantial gains for the company.
CRO’s daily trading volume more than doubled, reaching $4.72 billion, and so did its price. As a result, the CRO/USDT pair traded at 0.929 in the early European session Wednesday.
What happened?
As CoinChapter reported in the previous review, the deal cost Crypto.com $700 million and was one of the most expensive name-right deals in sports. Moreover, It came in the wake of an advertising campaign launched in late October, worth another $100 million. The latter involved several A-list showbusiness stars, actors, and athletes.
Crypto.com’s advertising frenzy aimed to increase the brand’s recognition and attract new customers. During the Singapore Fintech Festival, Kris Marszalek, the exchange’s chief executive, asserted that the industry as a whole could “cross one billion users […] and reach five billion in five years.”
As means of attracting new users to the crypto market, the Crypto.com Arena hit the mark. Mr. Marszalek commented on the AEG agreement, calling it a “worthwhile investment.” Meanwhile, the campaign created buying pressure that resulted in a 100% weekly uptrend for CRO.
The FOMO also caught the attention of experts in the industry. Meltem Demirors, chief strategy officer at investment firm CoinShares, called the token marketing strategy “smart.”
The CSO also added that she had no personal interest in the matter.
I don’t own any CRO, and i don’t have any financial or other interest in this, just find this super interesting as more crypto companies and token projects buy attention via traditional placements (ads, sponsorships, etc)
added the CSO in the Twitter thread.
Also read: Crypto.com's $700M marketing adventure pushes CRO price to a new record high.
As mentioned, the $800 million-worth advertising campaign in Q4 resulted in a 500% quarter-to-date rally. CRO traded at 0.929 USDT in the Wednesday session.
CRO daily chart flashed short-term bearish signs
The digital asset packed 19.8% in the previous 24 hours and 100% over the last week, pushing for $1.00. However, several technicals point to an upcoming halt, at least in the short term.
The CRO/USDT pair chart showed a trading volume bearish divergence, leading to a correction in the upcoming sessions.
In hindsight, a divergence is an incongruence between the price action and a technical indicator, in this case: the trading volume. While the price action was almost vertical, the trading volume started to decline in the past few days.
Also read: Polkadot, not Bitcoin the most commonly held crypto across institutional portfolios.
Moreover, the relative strength index (RSI; purple graph at the bottom) charted through overbought territory since the LA arena naming deal. As a momentum indicator, the RSI reflects the traders’ confidence in an asset.
When it is between 50 and 70, traders are likely to invest, as they expect returns. However, when the RSI crosses the ’70’ margin, traders might see the price as ‘too high’ and pull their bets to secure the gains. If and when they do, the price subsequently declines, and the asset enters a correction phase.
Also read: Bitcoin week ahead Ep18: Hawkish Fed policy expectations keep BTC under pressure.
Given the bullish advertising campaign, Crypto.com could see more gains ahead of the Q4 close. However, CRO might be correct in the short term due to trading volume divergence and an overbought RSI.
