HomeCoinsCardano (ADA)Here's why the recent spot market dip is testing DeFi's endurance

Here’s why the recent spot market dip is testing DeFi’s endurance

- Advertisement -


The crypto market is a volatile space, with the likes of Bitcoin leading the rally, rising  by 103% sometimes and other times also crashing by almost 70%. But the crypto market is not limited to just the spot markets. With the emergence of Decentralized Finance (DeFi), the spot markets found an affiliate. Today that affiliation has led to a major fall in the DeFi space.

What happened today?

As the impending corrections arrived on September 7, many coins witnessed price falls in double digits. Today too, the market is mostly red, except for a few lucky coins. This took a toll on the entire spot market itself as market capitalization dwindled. 

Since the September 7 crash, the crypto space lost about 15% of its market cap. Along with it, daily transaction volumes also fell by 50%, reaching $189 billion, down from $418 billion.

Heres why the recent spot market dip is testing DeFis

Total spot Market Cap | Source: TradingView – AMBCrypto

As a result, today, the DeFi Market cap is down by almost 8% from $135 billion. Since the September 7 crash, the DeFi market cap dipped by 13.72%. However, the last 4 days helped recover 11% of those losses.

Since the crash, volumes have also dropped as people have become cautious, leading to transaction volumes falling by $14 billion from $30 billion.

1631560864 243 Heres why the recent spot market dip is testing DeFis

DeFi Market Cap | Source: TradingView – AMBCrypto

The biggest DeFi token also suffered because of this. Today AAVE lost about 12% of its TVL, along with that 2.1% ETH TVL came down and BTC lost about 8% as well. In addition to this, its price also fell by 25.2% this week. 

1631560864 302 Heres why the recent spot market dip is testing DeFis

AAVE’s TVL changes | Source: DeFi Pulse

Since DeFi is a newer space it still has a relatively smaller participation of only a 3.3 million user base. Whereas the spot market already has over 300 million users, which is why it makes sense that it’ll follow the spot market’s movement.

Heres why the recent spot market dip is testing DeFis

Crypto users as of 2021 | Source: Triple-A

However, with Cardano smart contracts here, the DeFi space could see a rise in participation and volumes as well. And if the rise is consistently strong, who knows, in the future, DeFi could become an independent system as well.



Source link

- Advertisement -
Mr Bitcointehttps://www.bitcointe.com/
“Fact You Need To Know About Cryptocurrency - The first Bitcoin purchase was for pizza.” ― Mohsin Jameel
462FansLike
76FollowersFollow
4,567FollowersFollow
5,261FollowersFollow
1,501FollowersFollow
2,230SubscribersSubscribe

Most Popular

bitcoin
Bitcoin (BTC) $ 65,192.00
ethereum
Ethereum (ETH) $ 4,212.83
tether
Tether (USDT) $ 1.00
bitcoin-cash
Bitcoin Cash (BCH) $ 645.86
litecoin
Litecoin (LTC) $ 207.66
eos
EOS (EOS) $ 4.84
okb
OKB (OKB) $ 24.84
tezos
Tezos (XTZ) $ 7.00
leo-token
LEO Token (LEO) $ 3.09
cardano
Cardano (ADA) $ 2.23
monero
Monero (XMR) $ 262.92
stellar
Stellar (XLM) $ 0.392061
chainlink
Chainlink (LINK) $ 27.56
huobi-token
Huobi Token (HT) $ 9.19
tron
TRON (TRX) $ 0.103161
usd-coin
USD Coin (USDC) $ 1.00
dash
Dash (DASH) $ 202.74
neo
NEO (NEO) $ 45.34
iota
IOTA (MIOTA) $ 1.29
nem
NEM (XEM) $ 0.17835
zcash
Zcash (ZEC) $ 150.37
maker
Maker (MKR) $ 2,618.35
paxos-standard
Pax Dollar (USDP) $ 1.00
ethereum-classic
Ethereum Classic (ETC) $ 56.24
vechain
VeChain (VET) $ 0.124552
true-usd
TrueUSD (TUSD) $ 1.01
ftx-token
FTX Token (FTT) $ 61.71
kucoin-shares
KuCoin Token (KCS) $ 14.70
waves
Waves (WAVES) $ 29.43