A Solana (SOL)-based decentralized exchange (DEX) altcoin is rallying after a major crypto investment firm disclosed a large stake in the project.
According to a new Multicoin Capital announcement, the firm with $1.4 billion in assets under management (AUM) has built up a sizable position in Drift Protocol (DRIFT).
Drift is an open-source DEX that enables transparent and non-custodial trading.
Says Multicoin Capital,
“Multicoin has accumulated a large position across our funds – both liquid and venture – in DRIFT, the native token of Drift, a derivatives decentralized exchange (derivatives DEX) on Solana. We built the position over the last few years via private and public markets.”
On the same day as the firm’s announcement, which does not reveal the dollar figure of the investment, Drift soared by double digits reaching a high of $0.56.
Drift is trading for $0.55 at time of writing, up nearly 19% in the last 24 hours.
Multicoin’s analysis of Drift suggests the digital asset could soar to $3.58.
“We think the Drift protocol is poised to grow further as users and liquidity continue to migrate to Drift and Solana. Additionally, we think people all over the world in developing nations want synthetic access to every asset, and DeFi (decentralized finance) derivatives are the most innovative and inclusive products for them.
Based on our valuation framework and market assumptions, which we outline in the report, we value DRIFT in our base case at $3.58, more than 7x above its current market price.”
Generated Image: Midjourney