A TradingView data shows that the DeFi market cap has surged to a new peak of $146b. The DeFi space set a new peak price in May, a period that coincided with ETH surpassing $4K.
However, CoinMarketCap data confirms that Uniswap remains the number of DeFi projects based on market cap. Uniswap’s market cap is about $18.5b with about $5.5b TVL in smart contracts. However, the TVL across the whole DeFi space is $135b. Despite being the number DeFi project, SEC has launched an investigation into the activities of Uniswap.
The market mood about the DeFi market and product depends on the TVL. For instance, the market mood is positive when investors don’t mind leaving their funds in smart contracts – a sign of fund conservation. But the market mood is negative when investors prefer to cash out by withdrawing their gains from the market.
The DeFi space has experienced significant growth this month. Notably, Uniswap’s and AAVE’s native token surged by 45% and 32%, respectively, within that period. The DeFi sector might even experience more growth because of Ethreum’s recently completed upgrade, which has caused an increase in the volume of transactions on the network.
About DeFi Network And Platforms
A DeFi network consists of a series of open-source software and framework linked together to perform payment settlement for users without involving another entity. Uniswap is a DeFi platform where users can earn yields and convert their crypto to cash. Uniswap’s utilization of liquidity pools differs from the usual financial system that involves third-party in financial transactions.
Despite the growing popularity of the DeFi industry, some of them are not making progress. Today, a DeFi project named cover announced that it would no longer be in operation again. It cited the break of the project’s developers as a reason for stopping operations, but it gave no reason why developers decided to break up. Consequently, the project’s protocol lender will also cease to exist.
Cover Investors Advised To Withdraw Their Funds
Part of the announcement advised users to withdraw their assets quickly. Thus, it wasn’t a surprise the price of the project’s native token and the project’s market cap declined sharply. $cover lost 29% of its value, while its market cap dropped to about $17.1m.
You’d recall that Cover has been experiencing several issues. Late last year, its security was breached, with the hacker stealing over $4m worth of COVER even though the hacker returned all the stolen funds; also, with the same period Yearn.Finance chose not to move forward with the plan to purchase the whole shares of cover and merge with its own.
These are some of the reasons the cover community members suggested as other reasons why cover no longer exists. However, the DeFi ecosystem keeps growing. There are over 1.8m users now involved in the sector, even as the projects are made more secure and transparent to prevent the hacks experienced in the first two quarters of this year. Once this rebuild is complete, it will surely attract more investors into the DeFi industry.