Total Value Locked in DeFi has Risen by 2,000% in 2020

John P. Njui   •   DEFI • ETHEREUM (ETH) NEWS   •   DECEMBER 2, 2020

Quick take:

• Total value locked in DeFi has risen by 2,000% in 2020
• January had a total value locked of $0.67B compared to the current level of $14.74B
• The total value locked will soon break $15 Billion
• DeFi tokens have also experienced a bounce in the month of November
• This might be the beginning of a new market phase of growth for DeFi

2020 has been a year of tremendous growth in the DeFi realm. According to data from CryptoRank Platform and DeFi pulse, the total value locked in DeFi has grown by a staggering 2,000% since the beginning of 2020. At the beginning of the year, $0.67 Billion in digital assets was locked in DeFi. This value now currently stands at $14.74 Billion.

Below is a chart demonstrating the incredible growth in the value of digital assets locked in DeFi in the past eleven months.

(Click image for larger view)

Total Value Locked has Grown by 32% in November

The month of November has also been one of growth in DeFi. The total value locked on the Ethereum network across smart contracts, protocols and DApps, has increased by 32% from $11.18 Billion to the current level of $14.54 Billion.

Therefore, it is safe to predict that the total value locked in DeFi will continue to grow past $15 Billion and further as time goes by. Furthermore, the growth of DeFi will be aided by the progress and hype surrounding ETH2.0.

DeFi Tokens Also Experience a Resurgence in November

The month of November also saw a resurgence in the value of DeFi tokens. According to the team at CryptoRank Platform, popular DeFi tokens such as Yearn Finance (YFI), Aave (AAVE) and Sushi (SUSHI), experienced double-digit gains last month. Below is a list of tokens identified by CryptoRank Platform as having bounced back by double digits in the month of November.

• Ramp DeFi (RAMP) – 250%
• Sushi (SUSHI) – 221%
• Yearn Finance (YFI) – 165%
• Polkstarter (POLS) – 164%
• Aave (AAVE) – 163%
• Unilend (UFT) – 150%
• BZX Protocol (BZRX) – 148%

DeFi Will Continue to Grow

As earlier mentioned, DeFi will most likely continue to grow with time as more crypto investors familiarize themselves with the industry and methods of yield farming. Institutional investors and professional users have also started flocking into DeFi as demonstrated by the quick growth in total value locked.

In a late September Twitter thread, Crypto Analyst and Enthusiast, Andrew Kang, compared the DeFi environment to being between the first sell-off and bear trap as demonstrated in the following chart of a standard market cycle. High chances are that the DeFi market has overcome the bear trap phase.

(Click image for larger view)

Back in September, Mr. Kang explained that total value locked and innovation in DeFi are two forces that will propel the industry forward.

In terms of DeFi activity growth, TVL continues to advance parabolically after a small dip even in the face of price stagnation indicating more assets moving in.

For both public and private DeFi projects, the innovation and pace of development continues forward at a blistering pace – even faster than it was two months ago. Early players created the building blocks for new developers to build off of or take inspiration from.

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Original article posted on the EthereumWorldNews.com site, by John P. Njui.

Article re-posted on Markethive by Jeffrey Sloe

Aave Surges 25% as DeFi-Wide Short Squeeze Seems to Have Begun

By Nick Chong – November 8, 2020 in Aave Reading Time: 2min read

It appears that decentralized finance (DeFi) bulls have finally returned. Aave (AAVE), one of the leading crypto-assets in the DeFi space, has surged 25% in the past 24 hours alone.

This performance makes the coin the best-performing cryptocurrency in the top 100 by market capitalization. For further context, Bitcoin has gained five percent in the past 24 hours, as has Ethereum. The two leading cryptocurrencies have surged rapidly since the weekend lows.

Aave is set to continue higher, analysts say, as a result of trends in the market.

Aave Could Continue Higher Amid Short Squeeze

Analysts think that AAVE will continue its descent as the futures markets for the cryptocurrency indicate that a short squeeze may be taking place. One crypto-asset analyst shared this chart below amid the move higher, noting how the funding rate is seriously negative as open interest in these markets has begun to tick higher. This suggests an increase in short activity.

The issue is that at the same time, AAVE has pushed higher, putting short positions in a situation where they will need to close their positions to preserve their capital or wait until they are potentially short squeezed.

Chart of AAVE's price action over the past few weeks with an analysis of the futures market by crypto trader Mac (@MacnBTC on Twitter).
Source; AAVEUSD from TradingView.com
(lick image for larger view)

Institutional Accumulators

It appears that this correction to the upside is being triggered by institutional capital coming into the DeFi market.

Multiple fund managers and notable traders in the space have noted that they have been purchasing the cryptocurrency. The negative funding rate despite the increased price also suggests a spot-led rally.

Even still, some aren’t convinced that the bottom is in for the DeFi market. One analyst commented:

“I constantly update my views and unfortunately it looks like there’s going to be more pain in DeFi. Originally I thought we won’t see a 80-90% crash which is typical of alts because of the level of sophistication of DeFi investors but that thesis is being invalidated.”

Ari Paul, CIO and CEO of BlockTower Capital, also noted previously that even though an asset class has dropped 85%, it could drop even further. He did not explicitly say that it would drop further, but noted that this space has an entirely feasible chance of dropping an extra 60% to the macro lows.

Featured Image from Shutterstock
Price tags: aaveusd, aavebtc, aaveeth
Charts from TradingView.com
Aave Surges 25% as DeFi-Wide Short Squeeze Seems to Have Begun

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The original article was written by a Nick Chong and posted on NewsBTC.com.

Article reposted on Markethive by Jeffrey Sloe

OKEx Incident Could Push More Crypto Users to Defi Protocols

John P. Njui   •   BITCOIN (BTC) NEWS • DEFI   •   OCTOBER 16, 2020

Quick take:

• OKEx has halted all crypto withdrawals
• One of the exchange’s private key holders is currently with authorities regarding an investigation
• Crypto outflows from OKEx are at zero
• The current incident is a reminder to crypto users that storing funds in CEXs is risky because they don’t own their private keys
• DeFi could benefit as a result of the OKEx incident

The crypto-verse has been hit hard by the news of OKEx halting all withdrawals after one of its private key holders is cooperating with Chinese authorities regarding an investigation. According to the official announcement by OKEx, the concerned individual cannot be reached.

One of our private key holders is currently cooperating with a public security bureau in investigations where required.

We have been out of touch with the concerned private key holder. As such, the associated authorization [of withdrawals] could not be completed.

Bitcoin, Ethereum and the entire Crypto Markets Shaken

A quick glance at Coinmarketcap reveals that total crypto market capitalization has dropped by approximately $1o Billion since news broke of the incident at OKEx. Bitcoin dropped from the $11,500 price level to the $11,200 support area as the OKEx news hit the internet. Ethereum also dropped hard from the $380 price level to the $365 support area.

The OKEx Incident Could Push Crypto Users to DeFi

According to data from CryptoQuant.com, OKEx crypto outflows currently stand at zero. The team further provided a chart illustrating the situation at OKEx which can be found in the tweet below.

With crypto traders unable to withdraw their funds, the stage is set for DeFi protocols to indirectly or directly plead their case in the sense that they are governed by community members and that users retain ownership of their private keys.

This fact has been demonstrated by the value of the UniSwap (UNI) token exhibiting a positive spike once news broke of withdrawals being suspended at OKEx. This event was captured by numerous crypto community members as seen in the following tweet that retweets another crypto community member’s observation.

CEXs Experiencing Issues is Bullish for DeFi

Only a few days ago, KuCoin was hacked and over $280 Million in crypto stolen. However, a majority of this amount was recovered through the collaboration with other crypto exchanges and crypto projects that managed to freeze the stolen funds on the blockchain. The KuCoin hack, coupled with the current situation at OKEx, led @CryptoMessiah to conclude that all these events are bullish for DeFi. His comments can be found in the following screenshot.

Screenshot courtesy of Twitter.

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Original article posted on the EthereumWorldNews.com site, by John P. Njui.

Article re-posted on Markethive by Jeffrey Sloe

Report: Ethereum (ETH) Holds 96% of Total Transaction Volume in DeFi

John P. Njui   •   DEFI • ETHEREUM (ETH) NEWS   •   OCTOBER 11, 2020

Summary:

• Ethereum continues to dominate the DeFi ecosystem
• In Q3 2020, Ethereum held 96% of DeFi’s total transaction volume
• Dapps that account for the majority of the total transaction volume were Uniswap, MarkerDay and Curve

The team at DappRadar has released Q3’s Decentralized Finance Report in which they analyze Dapp activity on the several blockchains of Ethereum (ETH), Tron (TRX), EOS, IOST, Ontology (ONT) and Neo (NEO).

According to the report, Ethereum continues to dominate the DeFi space with 96% of the total transaction being carried out on the Ethereum network.

Q3 2020 was the best quarter for the DeFi ecosystem so far…the DeFi ecosystem transaction volume surpassed $123 billion with 96% of total belonging to Ethereum.

The Launch of UNI Boosted the Use of UniSwap

Additionally, the majority of Ethereum’s transaction volume was due to the three Daaps of Uniswap (UNI), MarkerDAO (MKR) and Curve Finance (CRV). The report further highlighted that the popularity and usage of UniSwap has spiked since the introduction of the UNI governance token.

Other Smart Contract Protocols are Joining the DeFi Hype

The report by DappRadar also points out that the three blockchains of Ethereum, Tron and EOS hold up to 97% of the daily active addresses participating in DeFi. However, the dominance of these three blockchains might soon have to contend with the entrance of other smart contract platforms into the DeFi arena.

In terms of daily active wallets, Ethereum accounts for more than 57%…EOS and TRON hold 5%, and 35% respectively. In total Ethereum, EOS, and TRON hold up to 97% of the daily active wallets.

Other smaller protocols like IOST, Ontology, and NEO have followed the DeFi trend in Q3 2020. The daily active wallets of IOST, Ontology, and NEO have increased by 357%, 1,589%, and 840% respectively.

DappRadar Begins Tracking Dapps on Binance Smart Chain

One blockchain network conspicuously missing from the Q3 report, is the Binance Smart Chain. However, the exclusion might have been due to the fact that Binance Smart Chain was launched in the middle of Q3 right when DeFi was gathering steam.

Earlier this week, the team at DappRadar announced that they started tracking Dapps on the Binance Smart Chain.

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Original article posted on the EthereumWorldNews.com site, by John P. Njui.

Article re-posted on Markethive by Jeffrey Sloe