DeFi Ecosystems Crash as Solana and Ethereum TVL Figures Drop to Yearly Lows
Cyptocurrency based on a decentralized network of computer users was designed to offer freedom from centralization and the ability to avoid censorship. However, this model has been compromised as players have become increasingly interested in centralized games that are either restricted or sold for other currencies.
The “polygon zk rollups” are a set of tools that help the Ethereum community to keep track of their progress. They have just released their figures for the year, and they show that there has been a huge drop in the number of transactions on the Ethereum network.
Over the last two weeks, Solana, like Ethereum and numerous other DeFi ecosystems, has witnessed the worst of crypto markets as tokens plummeted and others were swallowed into worthless pricing.
Solana falls to its lowest point in over eight months.
The total value locked on the Solana chain sank to an eight-month low of $4.05 billion at the end of last week. According to DeFi Llama statistics, it fell below $4.50 billion for the first time since September last year. While the sum has now risen to $4.42 billion, it remains well below the TVL at the beginning of the year.
Since the beginning of April, the Solana ecosystem has lost over half of its TVL, and over 33.50 percent in the previous 30 days. On a year-to-date basis, the decline is much more pronounced. The current TVL value is around 60% lower than the $11.22 billion TVL figure from the beginning of the year.
TVL chart for Solana
Solana’s TVL has dropped 11.49 percent in the previous seven days, with virtually all of its 65 procedures showing red in their one-week changes. Despite this, Solana ranks fourth in TVL with a 3.95 percent market share, below Ethereum, BSC, and Avalanche. Solend, the company’s most popular protocol, is up 5.52 percent on the day. Only third-placed Marinade Finance has had a greater increase of 5.33 percent during this time.
Visit our Investing in Solana guide for more information.
Although Ethereum TVL is falling, DeFi’s market share is increasing.
As the markets collapsed last week, the biggest DeFi ecosystem also plunged into freefall. According to DeFi Llama, Ethereum TVL fell to its lowest point this year on May 15, hitting a low of $70.81 billion. Following the recent market collapse, the Ethereum ecosystem has dropped more than 50% from an all-time high of $160 million in total value locked (TVL) late last year.
For the time of writing, the TVL was trading at $71.81 billion, down 22.17 percent in the previous seven days. This drop has grown to 38.55 percent in the previous 30 days, and the dominant DeFi ecosystem has dropped 51 percent since the beginning of the year. Other DeFi networks have also incurred losses as a result of these losses. In the previous 30-days, the total value locked on Avalanche, Polygon, and Fantom has decreased by 50.29 percent, 30.46 percent, and 68.05 percent, respectively.
Interestingly, despite losing so much TVL during this bearish cycle, Ethereum has showed greater resiliency. During the current crypto market collapse, Ethereum’s market share domination has strengthened, implying that its rivals haven’t been as resilient to the falling markets.
On May 8, the first day of market-wide losses owing to UST depegging, Ethereum’s DeFi market share was 55.69 percent. This proportion increased when the crypto market fell sharply, hitting 63.72 percent on May 15. It’s worth mentioning that Ethereum lost around $32.873 billion in TVL (or 31.70 percent) during this time.
Visit our Investing in Ethereum page to learn more about Ethereum.
Cardashift for initiatives that matter
Dan Gambardello, the founder of Crypto Capital Ventures, called Cardano the “most solid, safe, and scalable blockchain” in a tweet to his 226k Twitter followers on May 12.
Gambardello, who also hosts the Crypto Capital Venture YouTube channel, praised Cardashift, a recently formed launchpad aimed at funding innovation via fundraising, development, and acceleration. The community-run launchpad, which is powered by the CLAP coin, is seen as one such endeavor that demonstrates Cardano’s potential.
Cardashift is the latest addition to the Cardano ecosystem’s various initiatives. Its methodology enables members of the community to invest in initiatives that have a positive effect. CLAP token holders be rewarded voting rights in the project selection process, as well as the ability to follow the projects’ development. Tokens may also be staked by community investors to fund particular initiatives.
Visit our Investing in Cardano guide to learn more about the cryptocurrency.
The “mir crypto news” is a piece that explains how the price of Ethereum’s native currency, Ether, has been dropping and the overall market cap for all cryptocurrencies has been declining.