SAFE Surges 20% as Bithumb Lists the Token, But Faces Reversal Risk

SAFE, the native token of Safe Wallet, surged 20% as Bithumb listed the token on its platform.

Cryptocurrency Safe (SAFE) price rallied on Jan. 10, surging by 20% and rising to $1.10 after major South Korea-based crypto exchange Bithumb announced a new KRW trading pair for the SAFE token.

The altcoin’s rally comes after a new listing on a premier South Korean exchange, which typically leads to a strong rally in the related token. SAFE also saw a surge in demand among derivatives traders.

Safe (SAFE) price soared on Jan. 10, rallying by 20% and rising to $1.10 after major South Korea-based crypto exchange Bithumb announced a new KRW trading pair for the SAFE token.

The altcoin’s rally comes after a new listing on a premier South Korean exchange, which typically leads to a strong rally in the related token. SAFE also saw a surge in demand among derivatives traders.

After kicking off the year at $0.924, SAFE price began to rally on Jan. 4, rising to a monthly high of $1.10 on Jan. 10. The altcoin’s rally occurred in a high-volume environment, with its daily trading volume surging by 429%, climbing from $15 million early Thursday morning to over $80 million.

At the time of writing, SAFE’s market cap stands at nearly $600 million, ranking 118th among all cryptocurrencies. Despite the recent rally, the altcoin still holds significant growth potential, considering that SAFE’s price remains 69% below its all-time high of $3.56 in April last year.

The recent rally in SAFE price can be attributed to two major factors. First, Bithumb announced it would add a KRW trading pair for the SAFE token on Jan. 10, along with SONIC and AHT tokens.

A SAFE/KRW trading pair will allow direct trading between the SAFE token and the South Korean won, making it more accessible to a wider audience, particularly in the South Korean market.

Second, typically, a listing on a premier South Korean exchange such as Upbit or Bithumb results in a strong rally in the related token. One such instance was reported earlier in October last year when SAFE secured a listing on Upbit, leading to a 72% surge in just one day.

Moreover, the altcoin also saw a rally as a result of increased demand among its derivatives traders. According to CoinGlass, open interest for SAFE in the futures market surged by 151% over the past day, reaching $19.5 million, much higher than the $5.5 million recorded at the beginning of the year.

However, it’s important to note that rallies following exchange listings often face a reversal as investors sell their holdings to secure profits. Notably, data from CoinGlass shows that over $5.96 million SAFE was sent to centralized exchanges on Dec. 10, compared to the $5.65 million withdrawn.

Additionally, the weighted funding rate for SAFE at press time was -0.6690%, which means short sellers were dominating the market, with more traders betting on its price to dip lower.

Such levels also increase the possibility of a short squeeze if the price reverses upwards, potentially forcing short positions to close.

At press time, SAFE had wiped most of its gains, falling 7% from its daily high, and was trading at $1.01 per coin.