Market

Blue-chip DeFi tokens are being smoked by Ethereum, with a 540% increase in 2021

DeFi has had an explosive year in terms of growth and user adoption. Most blue-chip DeFi tokens, however, are more than 50% below the all-time high (ATH) they set this year.

DeFi tokens undercut ETH

While 2021 is sure to be a great year for crypto holdings, in retrospect it looks like investors have seen better returns with the two largest cryptocurrencies (Bitcoin and Ethereum) compared to most DeFi blue chips.

According to DeFi Llama, the Total Locked Value (TVL) for DeFi logs was around $ 20 billion at the beginning of the year and is currently at $ 244.27 billion. Despite the impressive growth in usage and acceptance, most blue-chip DeFi protocols lag behind Ethereum and other Layer-1s in price movement.

According to index DeFi pulse index (DPI), a benchmark that spans 18 blue-chip DeFi tokens on Ethereum – Uniswap, Aave, Sushi, Compound, Synthetic, Yearn, and Balancer – is up 300% this year. In the meantime, ETH has grown by more than 540% in the same period.

DPI in USD (blue line) and Ethereum (red line) | Source: Coinecko

Measured differently, the ETH price was only 20% lower against its ATH from $ 4,878 in November, while the DPI was down more than 55% against its ATH in May. Interestingly, DPI – which tracks the performance of the entire crypto market – grew by around 300% by 2021, with incredible accuracy.

Uniswap’s UNI, the largest decentralized exchange (DEX) in the crypto space, is down more than 58% from its ATH and has consistently trailed Ethereum for most of the year. Aave, Maker, Sushi, Yearn, Synthetix, and Compound are also down 58%, 61%, 57%, 65% and 77%, respectively, from their ATHs.

In the traditional stock market, the term “blue chip” is often used to refer to companies that seasoned investors view as companies with solid fundamentals that have been proven over time and existence. These include Amazon, Microsoft, Apple, Nike, Coca-Cola and other big names. The same is true of the emerging and rapidly changing DeFi sector, where the term is often reserved for only the oldest, largest, and most established protocols in space.

Surprisingly, Curve, the largest DEX for stablecoins on Ethereum, is the only blue chip protocol to outperform Ethereum this year, despite a dismal token start in 2020. It started at $ 0.62 in 2021 and is currently trading at $ 5.66, up around 900% year over year.

Source: TradingView

With the promising Web 3.0 development and sidechain and layer 2 scaling solutions such as Arbitrum, Optimism, ZK-Sync and ZK-Starks, Ethereum blue chips will have many opportunities to present their benefits and create a new use case for crypto To create investors.

Join Bitcoin Magazine Telegram to keep track of news and comment on this article: https://t.me/coincunews

Follow the Youtube Channel | Subscribe to telegram channel | Follow the Facebook page

Annie

Championing positive change through finance, I've dedicated over eight years to sustainability and environmental journalism. My passion lies in uncovering companies that make a real difference in the world and guiding investors towards them. My expertise lies in navigating the world of sustainable investing, analyzing ESG (Environmental, Social, and Governance) criteria, and exploring the exciting field of impact investing. "Invest in a better future," I often say. That's the driving force behind my work at Coincu – to empower readers with knowledge and insights to make investment decisions that create a positive impact.

Recent Posts

Missed the AAVE Bullish Ride? This New Presale Can Turn Your Thousands into Millions

While Aave finds itself in uncertain territory, a fresh face in the crypto scene, Qubetics…

1 hour ago

Dogecoin Price Forecast: Analysts Push For $0.2288 DOGE While This Ethereum Altcoin Eyes 8,000% Gains In The Next 16 Days

Analysts push for a Dogecoin price surge to its $0.2288 yearly high while ETFSwap (ETFS)…

2 hours ago

Below $1 Swift Altcoin Competitor Could Overshadow XRP Price Potential Election Rally 

Discover the promising altcoin under $1 that may outperform XRP amid election volatility and market…

2 hours ago

Polkadot and SP Negócios Collaborate to Enhance Crypto Economy Development

Campinas, Brazil, 5th November 2024, Chainwire

2 hours ago

Terra Shuttle Bridge Has Now Been Disabled

Terra Shuttle Bridge has now been closed, and all remaining LUNC and USTC tokens have…

4 hours ago

FLOKI Announces Dubai Takeover with WAFI Mall Campaign

Miami, Florida, 5th November 2024, Chainwire

4 hours ago

This website uses cookies.