{"id":259858,"date":"2021-05-27T02:00:00","date_gmt":"2021-05-26T23:00:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/analyst-says-defi-and-stablecoins-held-up-well-as-crypto-markets-imploded\/"},"modified":"2021-05-27T02:00:00","modified_gmt":"2021-05-26T23:00:00","slug":"analyst-says-defi-and-stablecoins-held-up-well-as-crypto-markets-imploded","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/analyst-says-defi-and-stablecoins-held-up-well-as-crypto-markets-imploded\/","title":{"rendered":"# Analyst says DeFi and stablecoins held up well as crypto markets imploded"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 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-6a261e02a6ace\" 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-6a261e02a6ace\" 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\/analyst-says-defi-and-stablecoins-held-up-well-as-crypto-markets-imploded\/#New_users_increase_despite_declining_TVL\" >New users increase despite declining TVL<\/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\/analyst-says-defi-and-stablecoins-held-up-well-as-crypto-markets-imploded\/#Stablecoins_hold_their_pegs\" >Stablecoins hold their pegs<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># Analyst says DeFi and stablecoins held up well as crypto markets imploded <\/strong>&#8221;<\/p>\n<div class=\"post-content\" data-v-5a136f3a>The decentralized finance (DeFi) sector faced its first real challenge during last week\u2019s market sell-off that saw more than $1 trillion wiped from the global cryptocurrency market cap as traders feverishly ran for the safety of stablecoins amid tumbling prices.\u00a0<\/p>\n<p>Despite rapidly declining token prices, the nascent DeFi sector held its own as decentralized exchanges experienced a record $11.7 billion in trading volume on May 19. Uniswap (UNI) led with $5.7 billion in volume, followed by SushiSwap (SUSHI) which saw $2.8 billion in 24-hour trading volume. <\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-05\/c193bd30-68d5-4fae-8d19-6c90e84bc5ae.png\"><figcaption style=\"text-align: center;\"><em>Daily DEX volume. Source: <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/insights.glassnode.com\/defi-uncovered-exploring-the-crash\/\"><em>Dune Analytics<\/em><\/a><\/figcaption><\/figure>\n<p>According to the recent DeFi Uncovered report from Glassnode, blue-chip DeFi tokens including, UNI, SUSHI, Maker (MKR), Aave (AAVE) and Compound (COMP) have largely mirrored the decline of Ether (ETH) over the past two weeks, \u201cshowing relatively high beta to ETH but not exceeding the decline from ATH by more than 15% from the decline of ETH.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"New_users_increase_despite_declining_TVL\"><\/span>New users increase despite declining TVL <span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The pullback in prices, combined with users removing liquidity and rotating into stablecoins led to a 42% decline in the total value locked on smart contracts, which also closely tracked the falling price of Ether. <\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-05\/d3d19b6d-224e-4e83-bf1f-a5998f1b37e2.png\"><figcaption style=\"text-align: center;\"><em>Total value locked in smart contracts vs. ETH\/USD. Source: <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/insights.glassnode.com\/defi-uncovered-exploring-the-crash\/\"><em>Glassnode<\/em><\/a><\/figcaption><\/figure>\n<p>TVL is intrinsically tied to the underlying value of the deposited tokens and given that Ether is one of the main tokens locked across DeFi platforms, the falling TVL has less to do with users removing funds and is mostly related to the pullback in prices. <\/p>\n<p>Throughout last week\u2019s downturn, the percentage of the Ethereum supply locked in smart contracts remained above 23% while the supply on exchanges \u201cjumped from 11.13% to 11.75%.\u201d<\/p>\n<p>Despite falling prices, new users continue to enter the DeFi ecosystem and the total number of unique 30-day traders on the top DEXs surpassed the 1 million mark for the first time amid last week&#8217;s sell-off. <\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-05\/d3d26203-d58a-45fb-a8d1-9998ff3dd45b.png\"><figcaption style=\"text-align: center;\"><em>Unique DEX traders. Source: <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/insights.glassnode.com\/defi-uncovered-exploring-the-crash\/\"><em>Glassnode<\/em><\/a><\/figcaption><\/figure>\n<p>Uniswap is the clear leader with 815,000 unique users between April 24 to May 23, while 1inch (1INCH) came second with 78,200 users and SUSHI ranked third with 10,900 users. <\/p>\n<h2><span class=\"ez-toc-section\" id=\"Stablecoins_hold_their_pegs\"><\/span>Stablecoins hold their pegs<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Much of the strength seen in DeFi during the sell-off can be attributed to the healthy stablecoin market and the ability for major stablecoins like USD Coin (USDC), Tether (USDT) and Dai (DAI) to maintain their dollar peg \u201cfor the majority of the crash with volume-weighted average prices (VWAP) staying at $1.00 the majority of the time.\u201d<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-05\/00fb0f6b-f79b-40a3-bf2c-36d4e58d7540.png\"><figcaption style=\"text-align: center;\"><em>DAI price vs. USDT price vs. USDC price. Source: <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/insights.glassnode.com\/defi-uncovered-exploring-the-crash\/\"><em>Glassnode<\/em><\/a><\/figcaption><\/figure>\n<p>The performance of DAI was seen as \u201cespecially positive for DeFi\u201d according to Glassnode, as its circulating supply was able to adjust accordingly in response to collateral requirements and protocol stability. The report also highlighted that reclaimed collateral and DAI were removed from the supply as redemptions were claimed by collateral holders. <\/p>\n<p>Posey said:<\/p>\n<blockquote><p>\u201cThis behavior allows collateral to stay healthy, liquidations remain at a healthy level, and DAI to maintain its peg.\u201d<\/p><\/blockquote>\n<p>The one stablecoin that struggled to maintain its peg was TerraUSD (UST), which lost its peg on May 18 as the value of its collateral from LUNA fell below that of the stablecoin it collateralized. This led to \u201cunhealthy behavior in its lending market Anchor (ANC),\u201d causing a higher than average number of liquidations on the protocol\u2019s native lending platform. <\/p>\n<p>Overall, stablecoins performed their intended function and pegs held steady across the ecosystem with the on-chain stablecoin transfer volume reaching a record $52 billion during the height of the sell-off. <\/p>\n<p class=\"post-content__disclaimer\">The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.\n<\/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\/analyst-says-defi-and-stablecoins-held-up-well-as-crypto-markets-imploded\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Analyst says DeFi and stablecoins held up well as crypto markets imploded &#8221; The decentralized finance (DeFi) sector faced its first real challenge during last week\u2019s market sell-off that saw more than $1 trillion wiped from the global cryptocurrency market cap as traders feverishly ran for the safety of stablecoins amid tumbling prices.\u00a0 Despite&#8230;<\/p>\n","protected":false},"author":1,"featured_media":259859,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMDUvZGViZTMwOWEtMzIxZi00MTc3LWI3MmItYTYxZDlmZDZjOTljLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[92664,74867,74863,74860,76701,74868,75916,74891,77655,76700,74939,75493,89215,88700,82350,73785,70918,36041],"class_list":["post-259858","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-aave","tag-altcoin","tag-cryptocurrencies","tag-cryptocurrency-exchange","tag-dai","tag-defi","tag-dex","tag-ethereum","tag-maker","tag-makerdao","tag-market-analysis","tag-stablecoin","tag-sushiswap","tag-uniswap","tag-usd-coin","tag-markets","tag-sushi","tag-tether"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/259858","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=259858"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/259858\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/259859"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=259858"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=259858"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=259858"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}