UMA is a governance token of the UMA Project — a protocol enabling anyone to create synthetic tokens representing any real-world assets. UMA, which stands for Universal Market Access, was founded in 2018 by Goldman Sachs alumni and boasts an impressive list of backers, including Bain Capital Ventures, Coinbase Ventures, and others.
There are two key mechanics employed by the project — Priceless financial contracts and the Oracle system. Priceless contracts are used to mint synthetic tokens by locking collateral into a smart contract. UMA’s innovative approach is that those contracts do not require constant monitoring of the underlying assets’ prices; instead, it’s the token holders’ responsibility to make sure that their synthetic assets don’t become undercollateralized. If they do, another actor in the network — a liquidator — comes into play and liquidates the position. Liquidators are kept in check by disputers: if liquidation is made in a bad faith, they open a dispute. The Oracle system is made exactly for these cases: it reports the actual price of the asset in question, which decides the outcome of the dispute. Throughout this whole process, the honest parties are rewarded and the dishonest ones are penalized. UMA tokens are used in the dispute system to vote for price requests. The second role of the token is voting on the general improvements of the protocol.
UMA token trading started in late spring of 2020 and failed to make a splash at first, its price hanging around $1.3 — $1.5 for a few months. With the DeFi boom in the fall of the same year, though, UMA’s price shot up, reaching $24.99 in early September. As the frenzy died down and the DeFi investors made hefty profits selling their tokens, however, UMA became more moderate in price, trading sideways between ~$7 and ~$11 until January 2021. In February the team behind the project made a very timely play, offering a synthetic index of meme stocks called uSTONKS during the battle between the Wallstreetbets subreddit and the actual Wall Street, which sent UMA’s price to $43.37. UMA enjoyed this success until the crypto market crash in May when its price tumbled down to the $13 — $15 range. By July it reached ~$8.5, where it shows the signs of consolidation.
Despite the fact that 100% accurate technical analysis for UMA cryptocurrency is hardly possible, on this advanced technical analysis tool by TradingView you can see the real-time aggregated UMA buy-and-sell rating for selected timeframe. The summary for UMA/USD is based on the most popular technical indicators — Moving Averages, Oscillators and Pivots.
Below we have collected the most reliable price projections for UMA (UMA) from popular forecast platforms.
According to WalletInvestor, UMA price will grow from $8.38 to $22.774 in one year. That makes UMA an awesome investment. The long-term earning potential is 171.77%. Predicted price for the end of 2026 is $77.764.
Answering the question about if UMA is a good investment, TradingBeasts say a resounding yes. In the 2021 perspective, this coin price is predicted to reach $8.75445 with a reduction to $11.00737 by the end of 2022.
In DigitalCoin analysis, the price of UMA cryptocurrency will rise in the next 5 years starting from $8.54435 as of today’s price to $34.0061553. It will go up to $14.1109432 by 2022 and starts its reduction in 2023–2024. Based on this forecast, UMA is a profitable long-term investment.
As it can be clear from the analysis cited above, UMA (UMA) projections are rather contradictory. There is no universal consensus either about positive or negative future UMA price movements. Indeed, the future possible growth depends on various factors: announcements, new technological solutions of the UMA projects, the crypto environment in general, legal position, and so on. We kindly remind you that before investing in any cryptocurrency, it is essential to do your own research (DYOR).
Disclaimer: This article should not be considered as offering trading recommendations. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
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