DeFi tokens continue to suffer as Bitcoin dominates the market


  • DeFi tokens continue to fall as the BTC price rises.
  • Many leading tokens have lost more than 70% since their highest records.
  • TVL DeFi still remains high at over $11 billion.

Much of the interest and media frenzy surrounding the decentralised finance (DeFi) sector that emerged last summer has certainly begun to diminish, particularly in the case of token prices. Many of the best performing DeFi assets are still bleeding despite the upward trend in the broader cryptomoney market.

In terms of total locked-in value, the DeFi space still looks optimistic with only an 8% drop in cryptos guarantees in the ecosystem from its historical high. The current figure stands at $11.3 billion according to DeFi Pulse, however, the dollar-denominated measure that remains high could be due to the fact that Ethereum’s prices are recovering $400.

The same cannot be said for the majority of DeFi’s tokens, however, as most of them continue to be depleted while Bitcoin Optimizer market share slowly consumes them. Messari researcher Jack Purdy attributes this to an oversaturation of projects combined with insufficient new capital coming into the space.

DeFi dump continues

Funds that were randomly thrown into DeFi tokens over the summer appear to be moving to Bitcoin as the BTC recently reached a near three-year high of $14,400.

Looking at the major tokens by protocol, Uniswap UNI is suffering among the others with another 5% drop so far today and is trading for $1.82.

Since its historic high of nearly $8 in mid-September, the UNI has lost 76%. This decline could well be further aggravated when the token race ends on 17 November and millions of dollars are thrown into the market.

Second in terms of TVL protocol is the pillar of the MakerDAO crypto, which is holding up well as its native MKR token has remained relatively stable in terms of price over the past year.

Wrapped Bitcoin is third in terms of TVL and has also increased to record levels of more than $2 billion of BTC tokens on Ethereum.

More suffering on the horizon

Compound Finance’s COMP token continues to take a hit with a 74% drop from its peak, while Aave’s 100 times supply reduction programme has not prevented its new asset from dumping 52% since last month.

The token Curve DAO, CRV, is in a world of suffering losing a further 4% today and 98% since its historic peak during the DeFi media frenzy in mid-August. Synthetix is up for the year but has lost another 64% since its peak of $7.50 at the end of August.

Yearn Finance’s YFI climbed to $44,000 at the top of the DeFi FOMO, but has since fallen 80% at current prices around $8,450.

The pain is even greater for a host of other DeFi tokens such as Sushi and Swerve, which have virtually collapsed into digital dust.