Major Decentralized Finance (DeFi) tokens have posted some losses despite solid stats backing their popularity within the crypto community and beyond. A combined Binance futures index for the future of the DeFi scene is down by one-third amid heavy selling pressure. However, a puzzling factor is that the market is facing downtrends despite strong adoption signals coming from the sector overall.
The Binance DeFi Futures index is a financial instrument launched by Binance to allow people to bet on its future success on August 28 this year. The asset quickly rose to an all-time high of $1,189 within a day or two of its launch and that is when it seems particularly promising. However, in September, the DeFi sector has sustained considerable losses with all of the major platforms losing in 30+% range with some others even reducing their worth by more half. The Binance DeFi basket therefore also posted heavy losses and is now trading at around half of its all-time high value.
Critics say that the DeFi sector is a bubble and as such that it will need considerable correction if it needs to survive in the scene for a long-term. This considerable dip has been long overdue according to some experts and it may go down even further. However, the fundamentals of the DeFi sector continue to post impressive growth and sustainability despite this initial backlash from the crypto market. According to the latest stats, the Total Value Locked ( TVL) which is the total worth of assets locked has increased manifold despite this gloomy short-term. The total increase witnessed was 40% and and resulted in an overall $7.5 billion worth. In addition, the decentralized cryptocurrency exchange Uniswap has generated more than $15 billion worth of volume last month alone and is looking at bigger and bigger horizons in the future as the exchange grows in size. This is due to the ever-increasing demand of fully decentralized cryptocurrency exchanges that do not answer to government censors, etc.
So, the dip trapped many buyers on the wrong side of the market and according to the latest sentiment, it may go even lower than that. However, due to the ever-strengthening fundamentals, the DeFi sector it appears right now is here to stay for the long-term and will continue to experience growth in the coming months.
Image source: pixabay.com
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