Can the rising tide of the broad market raise the defibrillator?
The broader crypto market has been in “pump mode” for the past few days. Bitcoin price peaked at $ 62.93,000 while Ethereum rose to $ 3.97,000. In fact, other altcoins were also traded with relatively higher objectives. But what about the DeFi market and its tokens?
Assessment of the upward potential of the Defi. Token
AAVE, MKR and CRV – three of the best-known brands in the Defi space have had a pretty dry week. At the time of going to press, these altcoins had only had single-digit returns for the past 7 days. Meanwhile, other coins from space – from typical currencies to other smart contract-related tokens – have done relatively better.
The influx of new additions to the room in general and within individual protocols is not very high. Keep this in mind – since the beginning of October, the number of unique DeFi addresses has not increased by more than 100,000. While the increase in this metric has been fairly constant, it should be noted that the rate of increase at this stage is cause for concern.
In fact, the trading volume of these tokens has been successfully achieved, which underscores the market participants’ interest in them. As can be seen from the graph below, this metric shot up here and there between August and September, but has fallen sharply since the beginning of October.
The market cap / TVL ratio has also gone down so far, which is ruining the HODL story. At the time of writing, the ratio for AAVE, MKR, and CRV is 0.25; 0.15; 0.07. This again underscores the interest of market participants.
In addition, the net flow of exchanges has increased for most of the tokens mentioned above, implying the inflow and migration of DeFi tokens from private wallets and cold stores to exchanges. On average, more than 2 million CRVs have flowed into exchanges on a daily basis compared to just 1 million outflows.
The contagious effect of the dull and gloomy state of the indicators mentioned is clearly visible in the DeFi index. As can be seen from the chart below, it has not exceeded the $ 10,000 mark since mid-September – what is known as bearish.
From the figures above, it can be said that the DeFi token accumulation trend is gradually disappearing. If demand continues to drop and the population’s selling pressure continues to increase, these tokens will have a hard time reaching higher goals in the days to come. If that happens, even the broader market wave will not be able to lift DeFis Boot.
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According to Ambcrypto