After a strong start in 2021, token valuations and trading volumes have soared to ignite the current bull market. The DeFi industry as a whole took a rest for a while, and The NFT field becomes the focus.
Although investors’ attention is elsewhere, DeFi prices have time to consolidate, and project developers can focus on protocol upgrades. In the past month, DeFi-related tokens have been receiving attention and are expected to break through in September.
Data from Cointelegraph market with Transaction view Shows that multiple DeFi tokens including Aave (AAVE), Synthetix (SNX), YFI and SushiSwap (SUSHI) have risen nearly 40% since May 10, while the price of BTC is still 27% from its historical high % the distance.
The recent bullish interest in DeFi tokens has prompted some analysts to point out that “DeFi Summer 2.0” did happen, and on a much larger scale than anyone expected.
Do you all want DeFi Summer 2.0? Well, it’s here, but it’s much larger in scale and multi-chain.
First Matic and its $40 million incentive plan (1% of supply)
Then came the US$180 million avalanche (now worth about US$450 million)
Today Fantom and Celo have 300 million U.S. dollars and 100 million U.S. dollars respectively.
Solana and Tyra next?
-Ryan Watkins (@RyanWatkins_) August 30, 2021
On-chain indicators show that DeFi is heating up
Evidence that the DeFi space is heating up can be found in various on-chain indicators, which indicate a large amount of trading activity and more and more new users interacting with DeFi and DEX protocols.
According to data from Dune Analytics, as of August 31, the number of new participants entering the DeFi ecosystem has been increasing in the past year, reaching a record 3,285,643 total users.
The steady increase in new users helps keep the DeFi lending agreement and decentralized exchange (DEX) active. According to data from Dune Analytics, the weekly DEX trading volume in August reached the highest level since late May.
For those who are worried about the high transaction fees of Ethereum (Ethereum) The network may limit the ability of small investors to participate in the industry, the growing second-tier (L2) solution areas, such as Loopring (LRC) and cross-chain bridges with competing networks such as Solana, to ensure portfolios of all sizes Able to participate in DeFi investment.
One of the best examples is the rapid rise of Polygon (MATIC), a layer 2 network that has become the top blockchain for Total Value Locking (TVL). According to data from Defi Llama, Polygon is now TVL’s fourth-ranked chain, with more than 4.93 billion US dollars locked in the network.
As Bitcoin is still struggling to gain momentum below $50,000, the market may head towards the altcoin season. If this happens, top DeFi protocols with strong long-term fundamentals may benefit from the bullish momentum.
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