{"id":153750,"date":"2021-01-13T20:20:00","date_gmt":"2021-01-13T17:20:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/3-key-reasons-why-the-defi-sector-is-booming-again\/"},"modified":"2021-01-13T20:20:00","modified_gmt":"2021-01-13T17:20:00","slug":"3-key-reasons-why-the-defi-sector-is-booming-again","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/3-key-reasons-why-the-defi-sector-is-booming-again\/","title":{"rendered":"# 3 key reasons why the DeFi sector is booming again"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a39e47d6f9f5\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a39e47d6f9f5\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/3-key-reasons-why-the-defi-sector-is-booming-again\/#Bitcoin_and_Ethereum_carry_the_market_higher\" >Bitcoin and Ethereum carry the market higher<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/3-key-reasons-why-the-defi-sector-is-booming-again\/#Total_value_locked_is_on_the_rise\" >Total value locked is on the rise<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/3-key-reasons-why-the-defi-sector-is-booming-again\/#Increasing_DEX_volume\" >Increasing DEX volume<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># 3 key reasons why the DeFi sector is booming again   <\/strong>&#8221;<\/p>\n<div class=\"post-content\" data-v-5a136f3a>Data from Messari shows that over the past 30 days, the majority of tokens listed on the site\u2019s DeFi Assets index have rallied by more than 20%. A few standouts such as Maker&#8217;s MKR, Synthetic Network Token (SNX) and SushiSwap&#8217;s SUSHI gained more than 100% during the same time frame.\u00a0<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-01\/27f682b0-3b53-4365-bdd1-7513b835b2cb.png\"><figcaption style=\"text-align: center;\"><em>DeFi assets index. Source: Messari.io<\/em><\/figcaption><\/figure>\n<p>From Jan. 1 to Jan. 9, the decentralized finance sector saw its total value locked (TVL) rise from $15.678 billion to a record-high $23.092 billion, and this recovery to a new all-time high came about four months after the DeFi bull market abruptly came to an end. <\/p>\n<p>Now that Bitcoin (BTC) and Ether (ETH) have rallied to multiyear highs, investors are again turning their attention to the DeFi sector, and it&#8217;s likely that the start of a new bull market, soaring TVL in the top DeFi platforms, and the steady integration of Ethereum alternatives are the primary reasons for the current surge. <\/p>\n<h2><span class=\"ez-toc-section\" id=\"Bitcoin_and_Ethereum_carry_the_market_higher\"><\/span>Bitcoin and Ethereum carry the market higher<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The last few months of bullish price action from Bitcoin and Ether are undoubtedly having a positive effect on the entire cryptocurrency market. Currently, the combined market capitalizatio of the top two digital assets is more than $850 billion, comprising 80% of the total value of the cryptocurrency market. <\/p>\n<p>As the prices of the top cryptocurrencies rise, some investors look for ways to maximize their profits, and the high staking yields and four-digit investment returns offered by many of the small-cap tokens have proven to be an irresistible lure to traders. <\/p>\n<p>Historical data shows that when Bitcoin and Ether prices are rallying, altcoins tend to follow, and when Bitcoin consolidates in a &#8220;predictable&#8221; range, altcoins and DeFi tokens usually rally. This market dynamic could partially explain the recent surge in DeFi tokens. <\/p>\n<p><template data-name=\"subscription_form\" data-type=\"defi_newsletter\"><\/template><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Total_value_locked_is_on_the_rise\"><\/span>Total value locked is on the rise<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Data from DeFi Pulse shows that the total value locked across DeFi protocols has increased from $15.36 billion to $22.74 billion over the past 10 days. This sharp increase in TVL coincides with Bitcoin\u2019s rally from $29,000 to its $41,950 all-time high, and during the same time, Ether&#8217;s price also rose from $740 to $1,300. <\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-01\/d3b8e06a-564f-427c-a19d-7529a0c0f186.png\"><figcaption style=\"text-align: center;\"><em>The total value locked in DeFi. Source: <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/defipulse.com\/\"><em>Defipulse.com<\/em><\/a><\/figcaption><\/figure>\n<p>A number of high-profile partnerships and mergers between some of the top-ranked DeFi protocols are also attracting new funds to the sector. In early December 2020, Yearn.finance and SushiSwap, two of the top DeFi projects, announced a merger that saw the protocols develop resources and integrate their liquidity pools to increase the total value locked.<\/p>\n<p>Developments like this help to create a safer, more efficient user experience for members of the community and, in this instance, helped lead to a rise in YFI price from $18,255 at the beginning of Nov. 26, 2020 to the Jan. 9 swing high at $39,990, an increase of 118%<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Increasing_DEX_volume\"><\/span>Increasing DEX volume<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Volume and transactions are key metrics used when evaluating the value of a DeFi project and the strength of its community. One way to determine this is to look at the daily volume of a project\u2019s decentralized exchange (DEX) to get a picture of how much value is transacted on the protocol during a particular time frame.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-01\/aba723c6-0296-406b-9b60-1a0d9a480e7f.png\"><figcaption style=\"text-align: center;\"><em>Daily DEX volume. Source: <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/explore.duneanalytics.com\/dashboard\/dex-metrics\"><em>DuneAnalytics.com<\/em><\/a><\/figcaption><\/figure>\n<p>Since the start of 2020, the daily DEX volume for the top-ranked DeFi projects has more than doubled from $900 million on Jan.1 to a peak of $2.4 billion on Jan. 4, indicating a significant increase in user activity. This suggests that traders took advantage of the bull market conditions that much of the cryptocurrency market was experiencing during that time. <\/p>\n<p>With Ethereum 2.0 still rolling out, a critical issue to monitor during any DeFi boom is Etheruem gas fees and transaction speeds. Messari data also shows that DeFi tokens focused on layer-two solutions rallied strongly as developers searched for ways to successfully integrate faster, lower-fee off-chain options that can work as alternatives to Etheruem. <\/p>\n<p>As reported by Cointelegraph, tokens like Solana&#8217;s\u00a0SOL, Loopring&#8217;s LRC, Matic and THORChain&#8217;s\u00a0RUNE have all rallied as developers continue to search for and experiment with layer-two options. <\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/3-key-reasons-why-the-defi-sector-is-booming-again\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# 3 key reasons why the DeFi sector is booming again &#8221; Data from Messari shows that over the past 30 days, the majority of tokens listed on the site\u2019s DeFi Assets index have rallied by more than 20%. A few standouts such as Maker&#8217;s MKR, Synthetic Network Token (SNX) and SushiSwap&#8217;s SUSHI gained more&#8230;<\/p>\n","protected":false},"author":1,"featured_media":153751,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/s3.cointelegraph.com\/uploads\/2021-01\/cce19612-a823-414d-862f-c65dc33789b3.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74867,74863,74860,74868,74891,74939,73785],"class_list":["post-153750","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-altcoin","tag-cryptocurrencies","tag-cryptocurrency-exchange","tag-defi","tag-ethereum","tag-market-analysis","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/153750","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=153750"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/153750\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/153751"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=153750"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=153750"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=153750"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}