After bottoming out at about $10, SUSHI is back to moving towards its all-time high of $23.38 as it trades around $17.5. If Bitcoin doesn’t correct and takes the entire crypto market down with it, SUSHI has a good chance to rally here and make a new ATH just like other cryptos. And this high can be a lot higher as according to Jeff Dorman, CIO of digital asset investment management firm Arca, Sushi is currently the “most undervalued token” in the crypto market. In a detailed thread on Twitter, Dorman shared his reasoning for why the recent downward price action will be short-lived. SUSHI, the native token of Sushiswap, which accounts for the second-largest DEX market share at 15.5% after Uniswap’s nearly 60% dominance, has been underperforming both UNI and the broader DEX market since the beginning of the year, as evident in the 50% peak-to-trough decline in March and Apri. This is because of Uniswap V3 hype, PancakeSwap growth, and rolling 6-month vesting unlocks from initial Sushi yield farming, said Dorman. SUSHI’s biggest competition is likely to be CAKE and not UNI, whose high gas fees turned CAKE into a viable DEX which is why we zsaw flat TVL on SushiSwap & lower volumes in March / April, as users paid nothing in gas and earned higher LM rewards on Pancake, he added. 
While these factors don’t have any actual impact on the token’s valuation and core business, they are affecting the price. When it comes to vested supply, “dilution from yield farming can be just as painful when an asset is out of favor,” as happened with CRV and UNI during their short yield farming stint. According to Dorman, some of Sushi’s inflation could be mitigated through an ongoing proposal made by Yearn creator Andre Cronje that recommends looking up additional SUSHI into oSushi. Currently supported by 97% of the community, SUSHI tokens will be locked for up to 3 years if this passes. Another proposal, SIMP, has been introduced, which allows SUSHI rewards to be claimed immediately instead of vesting it over a six-month period with a penalty that is to be decided which will be directly sent to xSUSHI stakers. This is expected to end distraction and allow the project to focus on building. With over 68% votes, currently, the community has chosen 0% penalty and unlock. While the overhangs are impacting the price, they haven’t affected SUSHI’s performance as the DEX enjoys high volume, keeping between $500 million and $1 billion, and liquidity around $5 billion this month. Sushi is also launching cross-chain and seeing traction with Polygon (MATIC) TVL at $400 million. Also, there is an ongoing Treasury Diversification Proposal that would diversify the SUSHI-only treasury into a basket of blue-chip DeFi tokens, de-risking & strengthening the balance sheet. So, “as investors rotate back into DeFi (and they are), these are the opportunities to look for,” said Dorman.
