Injective Introduces ERC-404 Analog CW-404 — INJ Trading Sideways For Two Months

Key Takeaways

• Injective partners with DojoSwap to launch the CW-404 standard.
• CW-404 aims to attract Ethereum investment.
• A symmetrical triangle has been on the INJ chart since December which a breakout direction still not clear.

Injective Labs has partnered with the DojoSwap decentralized exchange (DEX) DojoSwap to launch the CW-404 standard. This is a plan designed to harness the excitement around Ethereum’s ERC-404. 

This initiative, announced on February 23, 2024, by Injective Labs CEO Eric Chen, introduces the CW-404 standard to the Injective network. Meanwhile, the price of the INJ token has been moving sideways since December, after reaching an all-time high of $44. 

What is CW-404?

The CW-404 is a blend of the CW-20 and CW-721 standards, which govern token issuance and non-fungible tokens (NFTs), respectively. The plan is to adapt the ERC-404’s concept for fractional NFT ownership to Injective’s ecosystem. This allows for things like tokenizing NFT exposure for loans or staking.

The CW-404 standard is Injective’s attempt to attract Ethereum’s investment flow into its network. Despite the experimental label and criticisms related to its naming convention, ERC-404 and its derivatives, like CW-404, represent a potential advance in blockchain and NFT technologies, with ERC-404 tokens already amassing a collective value exceeding $173 million shortly after their introduction earlier this year.

Injective Price Analysis 

The price of INJ formed a symmetrical triangle from December 18 upon reaching an all-time high of $44. As often in the case with symmetrical triangles, there is no telling from which side the price will break out. 

Considering that Injective has been on the rise since January last year, we could have seen the completion of this uptrend in December. In this case, the triangle would be the first part of a more significant correction phase. If this happens, INJ could fall by another 40% to a low of $20. 

Alternatively, December’s high could have been wave three out of five, making the symmetrical triangle its sideways correction for wave four. In this scenario, after the price reaches the triangle’s apex, we will see the next uptrend for the final wave develop. 

A new all-time high could come at above $50, but that should be the end of this larger uptrend. If and when this happens, the price will fall into a correction. 

Both possibilities are equally likely, considering the symmetrical triangle indicates equal pressure from buyers and sellers. In addition, the daily chart Relative Strength Index (RSI) is at 50%. 

This is why the breakout direction will dictate the future primary outlook. Until that happens, we could expect either of the scenarios we talked about above. 

Disclaimers

Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.