By
Steve Muchoki
May 9th, 2024
Since its mainnet launch in July last year, the Mantle Network has experienced substantial growth, currently ranking as the seventh largest Layer 2 chain with a TVL exceeding $217.5 million.
MNT, the native token of the Ethereum Layer 2 blockchain, Mantle Network, experienced a surge earlier today, climbing over 20% to hit a record high of $0.948. This surge comes amidst growing interest in Mantle’s applications and the broader Ethereum Layer-2 ecosystem, experts suggest.
The Double-Dose Drive Behind Mantle’s Popularity
Joe Caselin, Head of Institutional Marketing at crypto exchange BIT, attributed Mantle’s impressive surge to its unique offerings. Caselin highlighted Mantle’s “double-dose” drive, which offers double the market reference rate for staking Ethereum.
“With Mantle Staked Ethereum (mETH), the team has devised strategies to take market share away from Lido… The unusually high 7.2% native ‘double dose’ yield is a clear example,” Caselin stated.
He further emphasized that as users engage with mETH, developers are actively expanding Mantle’s Decentralized Finance (DeFi) ecosystem, enhancing mETH’s utility across various applications, and securing partnerships with projects appealing to institutional stakers.
Additionally, Rachael Lucas, crypto technical analyst at BTC Markets, pointed out Mantle’s correlation with Ethereum, which has surged over 30% in the last 30 days, surpassing the $3,000 mark. Lucas highlighted Mantle Network’s role as a Layer 2 scalability solution on Ethereum, utilizing validator nodes to compress transactions into Ethereum-compatible ‘compressed blocks,’ thereby reducing gas fees and enhancing transaction throughput.
Since its mainnet launch in July last year, the Mantle Network has experienced substantial growth, currently ranking as the seventh largest Layer 2 chain with a Total Value Locked (TVL) exceeding $217.5 million, according to CoinGecko data.
In December, Mantle announced the launch of Mantle LSP, a permissionless, non-custodial ETH liquid staking protocol, allowing users to stake ETH in exchange for mETH tokens. These tokens also enable users to generate returns, aiming to become the most widely adopted and capital-efficient ETH staking token.
The company stated that the goal is to position its treasury among the top three liquid staking providers after Lido and Rocket Pool, addressing concerns over the centralization of liquid staking contracts within the industry.
Growing Interest in Ethereum Layer 2 Ecosystem
Apart from Mantle’s DeFi projects, industry experts attribute the surge to the increasing attention towards the Ethereum Layer 2 ecosystem. CoinGecko data also indicates a 4.4% increase in Layer 2 market capitalization, with notable gainers including Immutable X (IMX) and Optimism (OP).
Greta Yuan, Head of Research at Institutional digital asset solutions firm VDX, emphasized the market’s growing interest in Layer 2, driven by anticipation of the ETH Dencun upgrade and high hopes for roll-up technology.
Caselin of BIT noted the anticipation for potential spot Ethereum Exchange-Traded Funds (ETFs) in the US as a contributing factor to Mantle’s price surge. Major asset managers like Fidelity Investments and BlackRock Inc (NYSE: BLK) have applied for spot ETH ETFs, with speculation regarding SEC approval possibly by May this year.
Analysts are now predicting a bullish outlook for MNT, with a potential short-term price target of $1. This forecast considers MNT’s past performance, technical analysis, and potential market dynamics. To achieve this target, MNT would need to increase by 5.26% from its current high of $0.95.