XDC Surges to 39-Month High After Announcing Partnership With PillarX

The native token of layer-1 blockchain XDC Network (XDC) soared on Sunday after breaking a key resistance level, surging 22% to trade at $0.1231. This price rally was fueled by a new partnership and a surge in trading volume and open interest in the futures market.

The XDC/USD pair price rallied after the project announced its partnership with account abstraction platform PillarX, which will integrate XDC into its ecosystem. This move will enable the platform’s users to incorporate XDC into their Web3 activities while benefiting from advanced features.

The partnership will also strengthen the XDC Network's presence in the RWA tokenization market by enhancing its accessibility and utility for tokenizing real-world assets through seamless Web3 integration. This process allows users to convert physical assets, such as real estate, into digital tokens that can be traded on blockchain networks.

The XDC Network has previously partnered with Archax, a digital securities exchange and custodian regulated by the Financial Conduct Authority, to drive the adoption of tokenized real-world assets. As a result, the project holds the second-largest position in the RWA market, trailing behind only Mantra, which has a market cap of over $3.6 billion.

Another factor that has contributed to renewed investor interest in the XDC project is the growth of its decentralized finance (DeFi) ecosystem in recent months. According to data from DefiLlama, XDC's total value locked (TVL) in the DeFi ecosystem has surged since the beginning of November, reaching an all-time high of $31.23 million on Sunday.

This growth in TVL indicates increasing activity and liquidity within XDC's DeFi protocols, which could be boosting the demand for the XDC token among users seeking to participate in DeFi applications.

Moreover, the altcoin's rally was partly supported by Bitcoin's (BTC) march back toward the $400,000 mark as the broader crypto market recovered following cooler-than-expected inflation data from the Bureau of Labor Statistics.

The Crypto Fear and Greed Index also shifted back to "Greed" from the neutral levels seen last week, with a reading of 70 at press time, indicating a risk-on sentiment in the market.

On the 1-day XDC/USDT chart, the Moving Average Convergence Divergence (MACD) indicator suggests that the rally could continue with both MACD and the signal line pointing upwards. This is confirmed by the Supertrend indicator, with the Supertrend line moving below the candle to support the bullish outlook.

The altcoin is also trading above the 50-day and 200-day Moving Averages which means the buying pressure is still up with bulls targeting higher prices, potentially aiming for a new all-time high of $0.19, around 39% higher than the current price.

However, the XDC rally could face a pullback before continuing its rally as its price approaches the upper Bollinger Band and the Relative Strength Index (RSI) nears overbought levels.

Another potential factor that could hinder a bullish continuation is increased selling activity observed from retail traders. Over the past day, XDC traders moved $3.06 million worth of tokens into exchanges, while $2.57 million was withdrawn from exchanges, according to data from CoinGlass.

Increased amounts of cryptocurrency being sent to exchanges are usually a sign that investors could be preparing to sell off their holdings either to cash in profits or rotate funds into a different asset.