UMA pumped this week but is still down from it’s highs – in this guide we forecast a UMA price prediction and a background of what UMA token is.
What is UMA COIN?
UMA is a blockchain-based open-source protocol built on the ethereum (ETH) blockchain. Contracts can use UMA’s Optimistic Oracle to quickly request and receive any type of data. The Optimistic Oracle serves as a generalized escalation game between contracts that initiate a request and the Data Verification Mechanism, UMA’s dispute resolution system (DVM).
The UMA token is the native currency of the UMA platform. UMA are used for a different purpose on the platform itself. Users can vote for UMA opportunity to invest and earn rewards by using the UMA token.
Watch the video below covering the potential target for UMA token. Subscribe to his YouTube channel for more crypto price analysis and price predictions.
How does it work?
Contracts can use UMA’s Optimistic Oracle to request and receive data data faster. The Optimistic Oracle serves as a generalized response game between contracts that initiate a price request and the Data Verification Mechanism, UMA’s dispute resolution system (DVM). Prices proposed by the Optimistic Oracle will not be forwarded to the DVM unless they are questioned. This allows contracts to obtain price information within any pre-defined time frame without the need for an asset’s price to be written on-chain.
The Web3 Oracle
UMA’s Optimistic Oracle allows contracts to ask almost any question and trust the answer. The Optimistic Oracle can provide arbitrary “long tail” data to Web3 protocols.
Hart Lambur, a co-founder of UMA, shares information about the different use cases that UMA’s Optimistic Oracle is powering and how it connects any kind of real-world, subjective data to smart contracts. Full presentation in the tweet below.
A longtail oracle, according to Hart, is one that can provide data on a variety of real-world variables in similarly to prices. As there is a much larger market for non-price data, Hart believes that Web3 is currently in need of flexible oracles like UMA’s. The large percentage of oracles continue to emphasize price feeds.
UMA Price Analysis
UMA token pump massively it went up 31% and it’s now in a slight retracement phase, the support levels of $1.74, as well as the resistance level of $1.90, is crucial price levels for UMA. Breaks from certain levels in price could signal further volatility in the following days
The UMA sentiment is currently bearish. This might be a sign that UMA is a bad investment for 2022.