Crypto Market Slides as Total Value Locked in Defi Falls Below $50 Billion Mark – Defi Bitcoin News
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The crypto market has been on a roller coaster ride lately, with prices fluctuating wildly over the past few weeks. This week, the total value locked in decentralized finance (DeFi) has dropped below the $50 billion mark, according to data from DeFi Pulse.
The news comes as the total value locked in DeFi projects has been on a steady decline since early May when it hit an all-time high of $70 billion. Since then, the total value locked in DeFi has dropped by almost 30% to $49.7 billion.
The decline in the total value locked in DeFi is largely attributed to the recent sell-off in the crypto market. Over the past few weeks, the prices of major cryptocurrencies such as Bitcoin, Ethereum, and Ripple have all dropped significantly. This has caused investors to liquidate their positions in DeFi projects, resulting in the decline in the total value locked.
The decline in the total value locked in DeFi is also being attributed to the recent increase in gas fees on the Ethereum network. Gas fees are the fees paid to miners for processing transactions on the Ethereum network. As the fees have increased, it has become more expensive for investors to interact with DeFi projects, resulting in fewer transactions and a decrease in the total value locked.
Despite the recent decline, the total value locked in DeFi is still far higher than it was at the start of the year. At the beginning of 2021, the total value locked in DeFi was just $13 billion, so the current figure of $49.7 billion is still a significant increase.
Overall, the decline in the total value locked in DeFi is a sign that the crypto market is still volatile and investors should be cautious. However, it is also a sign that the DeFi sector is still growing and that investors are still willing to take risks in this space.
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