• Popular and successful DeFi projects have lost more than 50% of their value in the past two months.
  • Statistics from Coingecko show that the market capitalization of the DeFi sector lost close to 50% of its value since September 1.

The DeFi industry had a crazy and significant boom in 2020, especially after the crash of March. Popular DeFi coins like Yearn Finance (YFI) reached a $1.27 billion market capitalization on September 12. Unfortunately, the digital asset has lost around $900 million since then. 

Other DeFi projects have suffered from the same fate in the past two months. It seems that the new industry is starting to lose a lot of its hype and DeFi tokens are under a massive period of consolidation. 

Yearn.Finance tries to find the bottom 

After charting a high of $43,000 on September 12, YFI has been charting a series of lower highs. Currently, the price is trading for $10,830, having broken down from a descending triangle pattern. As per the technical analysis, the target for YFI lies at around $8,320. However, this level has no strong support while looking at the price history. As such, we can expect the price to drop further to $6,200 before it finds viable support.

YFI/USDT 4-hour chart

YFIUSDT daily chart

BAND fails to make the most out of inverted head and shoulders

After reaching a high of $15.50 on September 1, BAND has dropped to $4.50 at the time of writing. The price had a bearish break out from the inverted head and shoulders pattern and has dipped below the 200-day SMA ($4.75). The next viable support lies at $3.25. To make matters worse, the 200-day SMA is on course to crossing over the 50-day SMA to form the death cross pattern.

BAND/USDT daily chart

BANDUSDT daily chart

AAVE is charting new all-time lows

Looking at the hourly AAVE/USDT chart, one can see that the price dropped from $42.25 on October 24 to $28.75, at the time of writing. That’s a 32% drop over the last six days. Having dropped below the previous all-time low of $32, the DeFi lending protocol is charting lower lows than ever before. As of now, it’s hard to predict the bottom since the price is in uncharted territory as of now.

AAVE/USDT hourly chart

AAVE/USDT hourly chart

The overall outlook for the DeFi market is not looking good. However, with Ethereum soon upgrading to Ethereum 2.0, one can hope that the improved scalability and speed will bring more optimism into this space. Until then, the potential investors will probably be extremely cautious before retaking the DeFi plunge.
 


Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

Recommended content


Recommended Content

Editors’ Picks

Ripple's XRP holds symmetrical triangle support as SEC acknowledges Bitwise XRP ETF filings

Ripple's XRP holds symmetrical triangle support as SEC acknowledges Bitwise XRP ETF filings

Ripple's XRP is down 3% on Tuesday despite the Securities and Exchange Commission (SEC) acknowledgment of Bitwise XRP ETF. Unchained Crypto noted that XRP ETF could underperform due to key fundamental issues.

More Ripple News
Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH and XRP could decline on FTX repayments pressure

Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC, ETH and XRP could decline on FTX repayments pressure

Bitcoin (BTC) price has been consolidating between $94,000 and $100,000 for two weeks. Ethereum (ETH) and Ripple (XRP) faced a pullback earlier this week. BTC, ETH and XRP prices could decline further as FTX repayments could raise selling pressure.

More Cryptocurrencies News
Real-World Assets outperform the AI sector in the crypto market over the past month

Real-World Assets outperform the AI sector in the crypto market over the past month

Real-World Assets (RWAs) outperformed the Artificial Intelligence (AI) sector in the crypto market over the past month, with a weighted average gain of 15.6% in January. 

More Cryptocurrencies News
Storj Price Forecast: Bulls aiming for double-digit gains

Storj Price Forecast: Bulls aiming for double-digit gains

Storj (STORJ), an open-source platform that leverages the blockchain to provide end-to-end encrypted cloud storage services, continues to trade higher by 4.4%, around $0.39 on Tuesday after rallying 5% the previous day.

More Cryptocurrencies News
Bitcoin: BTC consolidates before a big move

Bitcoin: BTC consolidates before a big move

Bitcoin price has been consolidating between $94,000 and $100,000 for the last ten days. US Bitcoin spot ETF data recorded a total net outflow of $650.80 million until Thursday.

Read full analysis
The Best Brokers of the Year

The Best Brokers of the Year

SPONSORED Explore top-quality choices worldwide and locally. Compare key features like spreads, leverage, and platforms. Find the right broker for your needs, whether trading CFDs, Forex pairs like EUR/USD, or commodities like Gold.

Read More

BTC

ETH

XRP