What's up with the sudden rise in APT?

We're not here to talk about whether now is a good time to buy or sell any cryptocurrencies.

But, something's caught our eye recently: The Aptos (APT) token is up a remarkable 350% since the start of the year.

So we thought we'd dive in and find out why.

Turns out, it's not entirely clear, but there are a few good theories.

Theory 1: Arbitrage

About half of APT’s $2 billion volume in the last 24hrs has come from the South Korean won trading pair on Singapore-based exchange UpBit, according to CoinGecko.

We can't read much of anything on UpBit (it's all in Korean), but we can read the price of APT, which, at the time of writing, is trading at $18.72 USD.

On Coinbase on the other hand, right now that very same token is trading at $17.94.

That's a 78c difference!

The theory is that people are buying it on Coinbase (or a similar exchange) and selling it on UpBit for a tidy profit.

In turn, this increases demand and the price of APT goes up.

Theory 2: Legitimate growth

While Aptos is only the 20th largest DeFi ecosystem, it has grown significantly in the past month.

The DeFi volume on Aptos went from $14 million last month to $51 million in January - and we still have about 5 days left!

This is the type of metric that should cause the price of a token to go up. It's like when an app has a few hundred users vs. thousands.

It becomes more valuable - that makes sense.

Theory 3: Liquidity pools

On 20 Jan, the Binance Liquid Swap platform launched its APT/Tether and APT/Bitcoin liquidity pools.

Basically, people can lock up their APT through Binance and earn interest on it.

This could contribute to the increase in token price as well.

A 350% increase on a token that has an almost $3B market cap is pretty huge.

It's impossible to pinpoint exactly what has caused it, but at least now we have some clues.

Just a quick word of warning though: sometimes when things rise quickly like this, they can crash just as fast.