Bitcoin

DeFi indices are falling despite strong fundamentals

On August 28, Binance Futures launched its DeFi Composite Index, a basket of DeFi tokens. This initially comprised 27% Chainlink (LINK) and 11% Aave (LEND) as well as nine other well-known DeFi tokens, each of which made up between 6% and 9.5% of the index. The index is updated weekly and now includes 19 different crypto assets.

However, The Binance Futures DeFi Index is down more than 50% from an all-time high of $ 1,189 on the first day of trading;; The basket changes hands for just $ 507.

Indices that follow DeFi tokens (decentralized funding) have gained in importance in recent weeks after August the DeFi bubble burst.

DeFi / USDT Composite Index: Binance Futures
DeFi indices are falling despite strong fundamentals
DeFi indices are falling despite strong fundamentals

September 15th TokenSets has launched its ‘DeFi Pulse Index Set’ (DPI), which consists of tokens from the ten largest decentralized funding protocols by Total Insurance Value (TVL).according to DeFi Pulse. The basket is rebalanced on the first day of each month and the size of each token is adjusted based on “its circulating market capitalization relative to other positions in the index”.

Despite the fact that the DeFi sector’s TVL continues to rise, the DPI has lost nearly a third of its value since its inceptionIt dropped below $ 130 in mid-September to test the $ 90 support.

DPI / USD: CoinGecko

Other crypto market data aggregators are signaling that the DeFi sector has failed;; Only 16 of the 100 tokens classified as “DeFi” on CoinMarketCap have seen gains of more than 1% in the past seven days.

Messari’s research, which tracks the performance of ETH-based assets, also suggests this The DeFi sector is currently in decline, with weekly and monthly losses of around 2%..

Despite the sharp falls in the price of most DeFi tokens, the fundamentals of the sector will continue to strengthen. The DeFi sector’s TVL value is up nearly 40% from $ 7.4 billion in the past 30 days, while Uniswap was more than $ 15 billion in volume last month, more than the large centralized exchange in US crypto asset, Coinbase.

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