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Volatility expected as $490M in ETH options expire shortly after the Ethereum Merge

Given the current state of the wider crypto market, some traders might be surprised to learn that Ether (ETH) has been trading in an ascending trend for the past 17 days. While the entire cryptocurrency market experienced a 10% decline on Sept. 13, Ether price held firm near the $1,570 support level.Ether/USD price index. Source: TradingViewIn less than 12 hours the Ethereum network is scheduled to undergo its largest ever upgrade and the possibility of extreme volatility should not be ignored. The transition to a Proof-of-Stake network will be a game changer for multiple reasons, including a 98.5% cut in energy use and reduced coin inflation.During an upgrade, there is always the risk of multiple malfunctions, especially in more complex systems like the Ethereum Virtual Machine processing. Even if the upgrade has been relatively smooth on previous testnet versions, it is impossible to predict the outcome of the decentralized applications and second-layer solutions plugged into Ethereum’s ecosystem.That is precisely why the $490 million Ether options expiry on Aug. 16 will put a lot of price pressure on both sides, even though bulls seem slightly better positioned as Ether nears $1,600.Most bearish bets are placed below $1,600Ether’s failure to break the $2,000 resistance on Aug. 14 and its subsequent plunge to $1,420 on Aug. 29 gave the bears the signal to expect continuation of the downtrend. That becomes evident as only 12% of the put (sell) options for Sept. 16 have been placed above $1,600. Thus, Ether bulls are better positioned for the expiry of $490 million weekly options.Ether options aggregate open interest for Sept. 16. Source: CoinGlassA broader view using the 1.06 call-to-put ratio shows a relatively balanced situation with bullish bets (calls) open interest at $252 million versus the $238 million put (sell) options. Nevertheless, as Ether currently stands near $1,600, both sides have similar odds of moving the needle.If Ether price remains below $1,600 at 8:00 am UTC on Sept. 16, only $27 million worth of these call (buy) options will be available. This difference happens because there is no use in the right to buy Ether at $1,600 or $1,700 if it trades below that level on expiry.Bears could pocket a $100 million profitBelow are the four most likely scenarios based on the current price action. The number of options contracts available on Sept. 16 for call (bull) and put (bear) instruments varies, depending on the expiry price. The imbalance favoring each side constitutes the theoretical profit:Between $1,400 and $1,500: 33,000 calls vs. 2,600 puts. The net result favors bears by $100 million.Between $1,500 and $1,700: 29,600 calls vs. 29,000 puts. The net result is balanced between bulls and bears.Between $1,700 and $1,800: 49,200 calls vs. 3,800 puts. The net result favors bulls by $80 million.Between $1,800 and $1,900: 81,400 calls vs. 700 puts. Bulls increase their gains to $145 million.This crude estimate considers the call options used in bullish bets and the put options exclusively in neutral-to-bearish trades. Even so, this oversimplification disregards more complex investment strategies.Macroeconomic turmoil might have helped ETH bearsEther bulls need to sustain the price above $1,500 on Sept. 16 to balance the scales and avoid a potential $100 million loss. However, Ether bulls were unlucky on Sept. 12 after the United States stock markets fell by $1.6 trillion on Sept. 13 due to a hotter-than-expected inflation report.There’s absolutely no way to predict the outcome of Ethereum Merge, let alone its price impact. However, analysis suggests these three indicators should be watched by traders during the Merge event. One can never guess the consequences of unexpected delays or even the positive impact of a smooth transition because investors could have priced in the Merge in advance, triggering a “sell the news” event. Consequently, both bulls and bears still have a shot on the Sept. 16 weekly options expiry. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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SOL price trending toward yearly low as Solana TVL drops $870M in three days

Solana (SOL) tumbled on June 16 amid a broader retreat across the top cryptocurrencies, led by the Federal Reserve’s 0.75% interest rate hike a day before.Solana price rebound fizzlesNotably, SOL/USD plunged nearly 17% to $30 a token, wiping almost all the gains from the day before. The SOL price volatility liquidated almost $10 million worth of contracts in the past 24 hours across multiple crypto exchanges, data from Coinglass shows. SOL liquidation record since May 17. Source: Coinglass The latest declines come as an extension to SOL’s broader correction, where it dropped by more than 90% after peaking out near $267 in November 2021. SOL also fell to its lowest level since July 2021 near $25.In addition, a higher interest rate environment and the collapse of high-profile crypto projects like Terra have strengthened SOL’s downside prospects. SOL paints “ascending triangle”Solana’s pullback move on June 16 began after testing a horizontal trendline resistance near $34 that constitutes what appears to be an “ascending triangle” pattern.Ascending triangles are continuation patterns, i.e., they tend to send the price in the direction of their previous trend. As a rule, breaking out of a triangle pattern in a bearish market, for example, sends the price down by as much as the structure’s maximum height.If SOL breaks below its ascending triangle’s lower trendline then the bearish profit target will come below $22.50, as shown in the chart below.SOL/USD four-hour price chart featuring “ascending triangle” pattern. Source: TradingViewSolana’s downside target is about 25% below today’s price and could be achieved by June. Nonetheless, if SOL bounces after testing the triangle’s lower trendline as support, it would eye the $34-36 range as its interim upside target.Massive SOL exitOver 27 million Solana tokens have exited its smart contract ecosystem since June 13. The total value locked (TVL) inside Solana smart contracts dropped to 74.65 million SOL (~$2.25 billion) on June 16, down 27% in the last three days, according to data tracked by DeFi Llama. That amounts to nearly $840 million of withdrawals from the ninth-largest blockchain ecosystem by market cap.Solana TVL performance since April 2021. Source: DeFi LlamaSolend, a lending platform functioning atop the Solana ledger, witnessed a 26.5% decline in its TVL in the last three days and was holding 9.66 million SOL (~$290 million) as of June 16. Nevertheless, it remains the leading platform by TVL within the Solana ecosystem.Related: Liquidity provider asks platforms to freeze 3AC funds to recover assets after litigationThe outflows indicate that depositors do not want to keep their SOL locked in DeFi protocols, a sentiment common across the sector after Terra, an “algorithmic stablecoin” project, collapsed last month.Contagion, another yield ponzi going down. Seriously get your coins off anything like Celsius and BlockFi before they aren’t your coins anymore. LFG, 3AC, Celcius etc all spread risk to each other and you pay the price for it https://t.co/cemFCvAeAz— Pentoshi Powell Jr (@Pentosh1) June 16, 2022Therefore, Solana’s path of least resistance remains skewed to the downside in the near term, particularly with no improvement in terms of macro and fundamentals. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Ethereum sell-off fears rise as crypto hedge fund moves $60M ETH to an exchange

Ethereum’s native token Ether (ETH) rose by more than 5% to reach its intraday high above $1,930 on May 30. Nonetheless, the ETH/USD pair risks facing another sell-off round due to concerns about a massive ETH inflow into an exchange.58.7K Ether transferred to FTX in MayOn May 30, the Ether address allegedly associated with Three Arrow Capital — a Singapore-based crypto hedge fund, sent 32,000 ETH worth $60 million to the FTX crypto exchange within a span of an hour, on-chain data shows. The bulk transfer, which follows the fund’s 26,700 ETH deposit to the same exchange earlier in May, raised suspicions that it would dump the Ether stash. That is primarily because, in theory, investors transfer crypto to their exchange wallets only when they want to sell them for other assets. dump eeth? https://t.co/7xdI80P8rZ— Tim Copeland (@Timccopeland) May 30, 2022Nonetheless, the number of Ether held by exchanges continued to drop in May, according to on-chain data tracked by Glassnode. The ETH balance across all the crypto exchanges dropped from 20.45 million to 20.38 million month-to-date (MTD), underscoring that investors are holding their investments for the long term. Ethereum balance on exchanges. Source: GlassnodeETH rebound weakensThree Arrow’s massive Ether transfer to FTX coincides with ETH testing a critical support-turned-resistance level near $1,920 for a breakout, as shown below.ETH/USD four-hour price chart. Source: TradingViewSimultaneously, Ether’s relative strength index is near its “overbought” threshold of 70, which as a rule of technical analysis tends to precede a sell-off. In other words, ETH could consolidate around $1,920 in the coming days before pulling back to its rising trendline support near $1,850.Related: ‘Mega bullish signal’ or ‘real breakdown?’ 5 things to know in Bitcoin this weekConversely, a decisive move above the $1,920-level, accompanied by a rise in trading volumes, could trigger a long-term upside setup shared by “Wolf,” a pseudonymous market analyst, as shown below.ETH/USD weekly price chart. Source: Wolf/TradingViewThe setup showcases the levels around $1,820 as support in a so-called accumulation range, with $4,000 serving as resistance on the other end. Wolf noted that the price could rally toward $4,000 “a few months from the Merge,” a highly-awaited upgrade that would make Ethereum a proof-of-stake protocol.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Ethereum preparing a 'bear trap' ahead of the Merge — ETH price to $4K next?

Ethereum’s native token, Ether (ETH), continues to face downside risks in a higher interest rate environment. But one analyst believes that the token’s next selloff move could turn into a bear trap as the market factors in the possible release of the Merge this coming August.ETH to $4K?Ether’s price could reach $4,000 by 2022’s end, according to a technical setup shared on May 20 by Wolf, an independent market analyst.The analyst envisioned ETH moving inside a multi-month ascending triangle pattern, which comprises a horizontal trendline resistance and rising trendline support. Notably, ETH’s latest retest of the structure’s lower trendline could initiate a big rebound toward its upper trendline, which sits around the $4,000-level, as shown below. ETH/USD three-day price chart featuring ascending triangle setups. Source: Wolf/TradingViewWolf took his bullish cues from a similar triangle setup from 2016, whose formation preceded a major bull run from $1 to $27. Similarly, another ascending triangle occurrence in 2017 coincided with a bullish follow-up, wherein ETH/USD rose 270% to over $1,500.The Merge vs. low liquidity “death spiral”Wolf’s fractal-based analysis came as Preston Van Loon, one of the Ethereum core developers, confirmed that the blockchain project’s much-anticipated upgrade to a proof-of-stake consensus mechanism would occur sometime in August.Wolf noted that Ethereum was setting up a “bear trap,” which would make sense prior to the upgrade, complimenting his technical setup, as discussed above.Bear trap few months from the #merge makes sense. $ETH— Wolf (@IamCryptoWolf) May 20, 2022The pending upgrade was one of the key catalysts behind Ether’s price rally in 2021, as many investors believed it would improve the long-standing scalability problem in the Ethereum blockchain while cutting transaction and gas costs. Nonetheless, Ethereum Foundation kept delaying the launch.”Undoubtedly, this lack of progress has played a major role in Ethereum’s recent price decline,”  Bitfreedom Research, a tech-stock and crypto research entity, noted while predicting ETH’s price to decline toward $950–$1,900 by October 2022. Related: Analysts note parallels with March 2020: Will this time be different?The firm cited higher interest rates as the core reason behind its bearish outlook for Ethereum, noting:”The crypto market moves extraordinarily fast, which means crypto companies need LOTS of cash to power rapid growth. With no cash available, this can lead Ethereum’s ERC20-token economy to move in a death spiral.”The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Ethereum in danger of 25% crash as ETH price forms classic bearish technical pattern

Ethereum’s native token Ether (ETH) looks ready to undergo a breakdown move in May as it forms a convincing “bear pennant” structure.ETH price to $1,500?ETH’s price has been consolidating since May 11 inside a range defined by two converging trendlines. Its sideways move coincides with a drop in trading volumes, underscoring the possibility that ETH/USD is painting a bear pennant.Bear pennants are bearish continuation patterns, meaning they resolve after the price breaks below the structure’s lower trendline and then falls by as much as the height of the previous move downside (called the flagpole).ETH/USD two-hour price chart. Source: TradingViewAs a result of this technical rule, Ether risks closing below its pennant structure, followed by additional moves to the downside. The height of ETH’s flagpole is around $650. Therefore, if the price undergoes breakdown at the pennant’s apex point near $2,030 then the structure’s bearish target will be below $1,500, down over 25% from today’s price.Sell-off, pullbackInterestingly, the bear pennant’s profit target falls into the area that preceded a 250% price rally in the February-November 2021 session. Also, the target is around Ether’s 200-week exponential moving average (200-day EMA; the blue wave), currently near $1,600.Ideally, the demand zone could prompt Ether traders to accumulate the tokens in anticipation of a sharp upside retracement. Suppose it happens, then ETH’s price interim profit target would likely be the multi-month downward sloping trendline that has served as resistance in a “falling channel” pattern, as shown in the chart below.ETH/USD weekly price chart. Source: TradingViewETH has already been rebounding after testing the demand zone (and the falling channel’s lower trendline) as support. This could push ETH/USD to reach the channel’s upper trendline near $3,000, about 50% above today’s price, by June.Extended breakdown scenarioThe worst-case scenario could be ETH breaking below the demand zone, led by macro risks and their impact on the crypto market so far in 2022.Related: $1.9T wipeout in crypto risks spilling over to stocks, bonds — stablecoin Tether in focusNotably, Ether has declined by over 50% quarter-to-date as investors reduce their exposure to the riskier assets, including Bitcoin (BTC) and tech stocks, in a higher interest rate environment.As Cointelegraph has reported, anticipations of additional stock market selloffs could weigh on cryptos, thus hurting Ether, Bitcoin, Cardano (ADA), and others in tandem.Ethereum’s correlation coefficient with tech-heavy Nasdaq 100 is at 0.90. Source: TradingViewBOOX Research, a financial blogger at SeekingAlpha, remains long-term bullish on Bitcoin, Ethereum, and the broader crypto market but believes a recovery might take several years. Excerpts from its note:”While some of the corrections from the top may have simply shaken out the ‘hot money,’ there is still a risk that a deteriorating macro environment opens the door for even deeper losses.”The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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3 reasons why Cardano can sink further despite ADA price bouncing 58%

Cardano (ADA) pared a big portion of the weekly losses incurred during this week’s crypto market rout. ADA’s price reached an intraday high of $0.60 on May 13, a day after rebounding from its week-to-date low of $0.38 — a 58% rally. The huge upside retracement appeared in the wake of similar price action in the crypto market with top cryptos Bitcoin (BTC) and Ether (ETH) rebounding by 23% and 25.75% since yesterday’s lows.The top ten crypto assets’ recovery in the past 24 hours. Source: MessariBut the sharp ADA recovery does not promise an extended upward continuation, at least according to three of these factors discussed below.Stock market crash far from overFirst, the price action in the Cardano and similar crypto-assets has been in lockstep with U.S. equities, especially tech stocks.Notably, the correlation coefficient between ADA and the tech-heavy Nasdaq Composite was 0.93 on May 13, meaning that any major moves in stocks would likely steer Cardano in the same direction. The correlation between Cardano and Nasdaq Composite. Source: TradingViewMoreover, the chances of Nasdaq undergoing a sharp recovery are currently slim, as analysts highlight the overstretched valuations of the Big Tech stocks and their probability of crashing further in a higher interest-rate environment.”The [ax] is hanging, rather, over high-growth tech companies,” opines Richard Waters, the Financial Times’ West Coast editor, adding: “This is where valuations became most stretched, and where the market is having the most trouble finding its nadir.”Simply put, Cardano’s persistent positive correlation with Nasdaq could result in more sharp declines in the ADA market, at least for the time bein.ADA’s “fifth wave missing”Secondly, another hint of a potential Cardano price decline comes from a technical structure highlighted by Capo of Crypto, an independent market analyst.The pseudonymous analyst notes that ADA could fall to the $0.30-$0.35 range next, given its possibility to paint the fifth and final wave of a bearish Elliott Wave setup, as shown in the chart below. ADA/USD two-day price chart featuring bearish Elliott Wave setup. Source: Capo of Crypto/TradingViewThe target range coincides with the support area from January 2021 that preceded a 850% bull run.Descending channel breakdown Thirdly, Cardano has been breaking below its multi-month descending channel in another sign of weakness.  ADA has been trending lower inside a range defined by two falling, parallel trendlines, underscoring traders’ current strategy of buying near the lower trendline and selling toward the upper trendline. But on May 12, ADA/USD broke down below the lower trendline near $0.568, showing that traders ignored the buying opportunity.Instead, buyers showed up near the $0.378-level to accumulate ADA, leading to the price rebound, as discussed above. However, the trading volume backing the recovery move was lower than during the selloff’s, indicating a weakening rebound trend.ADA/USD daily price chart. Source: TradingViewSimultaneously, the upside retracement move showed signs of further weakness after testing the descending channel’s bottom as resistance — a way of confirming the breakdown. If the bulls fail to flip the price ceiling to support, then ADA’s likelihood of continuing its prevailing downtrend will be much higher.Related: Look out below! Ethereum derivatives data hints at further downside from ETHConversely, a decisive move above the channel’s lower trendline could have ADA then test its upper trendline near $1. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Near Protocol eyes a Terra-like price rally after new $350M funding raise

Near Protocol (NEAR) has rallied by almost 30% after announcing on April 6 that it had raised $350 million in a funding round led by Tiger Global, a New York-based hedge fund. NEAR price eyes 100% price rallyNEAR’s price reached over $19.75, just about 2.5% below its all-time high. However, many analysts agreed with the potential for the NEAR/USD pair to reclaim its best level to date, and even rise above it in the coming weeks.NEAR/USD daily price chart. Source: TradingViewAdoption remained the key focus behind the bullish predictions. For instance, Zoran Cole, the founder of the popular Telegram group Crypto Insiders highlighted that Near Protocol will announce the launch of its own native algorithmic stablecoin called USN as early as April 20.The stablecoin will reportedly use a Terra-like native token burn mechanism to maintain the U.S. dollar peg, effectively reducing NEAR supply. Additionally, as Cole asserted in his investment thesis, Near will offer stakers an annual percentage yield of around 20%, thus incentivizing DeFi capital rotation toward its pools and boosting NEAR’s demand simultaneously.2/ $USN by @NEARProtocol : https://t.co/kHNqXVuTSJ— Do Kwon (@stablekwon) April 8, 2022″This will lead to a comparison of Near to Terra as the narrative for attractive stablecoin yields proliferates,” he noted, adding:”Terra currently has a market capitalization of approximately $40 billion while Near sits at $10 billion. The catalysts above will strengthen Near’s fundamentals in both the short and long term and likely cause its market capitalization to appreciate by 100% at minimum over the next few months.”Slim Trady, a pseudonymous market analyst, also expects NEAR to reach new all-time highs, noting that there is “no substantial resistance left” on the coin’s chart that could cap its upside moves.Don’t act like nobody told ya about $NEAR.Patience. That’s all you’ve ever needed in this market.New ATHs are very #NEAR…teehee.✍️✅ https://t.co/M2QdtXvdE7— Slim Trady – non giver of ICP (@TradySlim) April 7, 2022

NEAR Coinbase listing near? Despite being in the top-20 crypto assets by market capitalization, NEAR remains listed only on a few crypto exchanges, including Binance, Huobi, KuCoin, and Upbit, limiting its exposure, especially in voluminous markets like the U.S.Related: Terra buys $200M in AVAX for reserves as rival stablecoins emergeBut Kole noted that Coinbase, one of the leading U.S.-based crypto exchanges, will list NEAR on its platform “in the next couple of months,” noting that it would help boost the coin’s retail visibility.”This also paves the way for Near NFTs to be integrated into Coinbase’s upcoming NFT marketplace.FTX, a crypto exchange headed by Sam Bankman-Fried, could also list NEAR pairs given its investment arm FTX Ventures being one of the backers in Near Protocol’s latest $350 million funding rebound.Price levels to watchFrom technical perspective, NEAR now eyes a run-up toward its current record high above $20.50.NEAR/USD daily price chart. Source: TradingViewA decisive break above the level, which coincides with the 1.0 FIb line of the Fibonacci retracement graph, drawn from $20.78-swing high to nearly $6-swing low, could have NEAR eye $29.70 as its next upside target.Conversely, a pullback risks putting NEAR’s price en route below its interim support near $17.55, with the next downside target at around $15.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Solana jumps past key selloff junction: SOL price eyes $150 in April

Solana (SOL) jumped past a critical resistance level that had limited its recovery attempts during the November 2021-March 2022 price correction multiple times, thus raising hopes of more upside in April.Solana flips key resistance to supportTo recap, SOL’s price underwent extreme pullbacks upon testing its multi-month downward sloping trendline in recent history. For instance, the SOL/USD pair dropped by 60% two months after retracing from the said resistance level in December 2021. Similarly, it had fallen by over 40% in a similar retracement move led by a selloff near the trendline in November 2021.SOL/USD daily price chart. Source: TradingViewBut Solana flipped the resistance trendline as support (S/R flip) after breaking above it on March 30, accompanied by a rise in trading volume that showed traders’ conviction in the breakout move. In doing so, SOL’s price rallied by 25% to reach $135, bringing the psychological resistance level of $150 within reach.Why is SOL (technically) bullish?From a technical perspective, SOL’s breakout move above its falling trendline resistance coincided with a bullish crossover between its two key moving averages: the 20-day exponential moving average (20-day EMA; the green wave) and the 50-day EMA (the red wave).Dubbed the golden cross, the technical indicator occurs when an asset’s short-term moving average jumps above its long-term moving average. Traditional analysts consider this crossover as a buying signal.SOL/USD daily price chart featuring ‘Golden Cross.’ Source: TradingViewFor instance, the 20-50 EMA crossover in August 2020 may have assisted in pushing SOL’s price upward by more than 650% to over $267, in addition to other fundamental and technical catalysts. As such, the golden cross boosts SOL’s likelihood of continuing its rally, as well as its breakout above the falling trendline resistance.RSI divergenceThe upside prospects increase further if a technical fractal highlighted by Delphi Digital is to be believed.The crypto research firm highlighted a correlation between SOL’s price and the combination of its two technical indicators: the S/R flip and relative strength index (RSI) divergence.Notably, the first time Solana’s RSI jumped above 70, an “overbought” area, after a strong price uptrend — that had it also break above the descending trendline support of that period — SOL tended to continue rallying despite its RSI consolidating lower or sideways. Solana daily price chart featuring S/R flip and RSI divergence. Source: Delphi DigitalFor instance, SOL rallied 378% after the first time its RSI broke above 70 in August 2021. Similarly, the period of an overbought RSI during May-June 2021 also coincided with Solana’s 268% upside move. The fractals appeared similar to how SOL has been performing lately, suggested Delphi Digital.Related: Opera integrates Bitcoin, Solana, Polygon and five other blockchainsTherefore, SOL/USD could continues its uptrend when using Fibonacci retracement levels, drawn between $261-swing high to $77.50-swing low, suggesting $147-$150 as the interim upside target.SOL/USD daily price chart. Source: TradingViewConversely, a pullback upon or ahead of testing the $147-$150 price range can result in SOL retesting the $120 as its interim support, with a possible slide toward the 20- and 50-day EMAs.The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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