The broader crypto market has been in “pump mode” for the past few days. Bitcoin’s price managed to hit levels as high as $ 62.93,000 while Ethereum managed to pump to $ 3.97,000. In fact, other alts were also being traded towards relatively higher goals. But what about the DeFi market and its tokens?
Assess the likelihood of his boat being lifted
AAVE, MKR and CRV – Three of the most famous brands from space have had a pretty dry week. At the time of writing, it was found that these tokens had been picking up their investors in the past 7 days with only single-digit returns. Other tokens from space – from typical currencies to other smart contract-related tokens – have performed comparatively better.
The influx of new participants in the room as a whole and in individual minutes was not very high. Keep this in mind – the number of unique DeFi addresses has not increased by more than 100,000 since the beginning of October. 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 suffered a slump, underscoring the rusty interest of market participants in this crypto subgroup. As can be seen from the chart below, this metric saw some peaks here and there in August-September, but has been pointing downwards since the beginning of October.
The market cap to TVL ratio has also been in decline lately, which blows the HODLing narrative away. At the time of writing, that ratio for AAVE, MKR, and CRV was 0.25, 0.15, 0.07. This again underscores the dwindling interest of market participants.
In addition, the net flow on the exchanges has seen an increase for most of the aforementioned tokens, implying inflows and the movement of DeFi tokens from private wallets and cold stores to exchanges. On average, over 2 million CRV tokens flow into exchanges every day, compared to just 1 million outflows.
The ripple effect of the dull and somber state of the above metrics was clearly visible when reading the DeFi Index. As can be seen from the chart below, it has not exceeded the $ 10,000 mark since mid-September – which is arguably bearish.
Keeping the conclusions from the above datasets, it can be said that the DeFi token accumulation trend is gradually fading. If demand continues to decline and prevailing selling pressure gains momentum, it will be difficult for these tokens to reach higher goals in the coming days. If that happens, then even the wider market tide would not be able to lift DeFi’s boat.