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Binance Futures and Tokensets’ DeFi Indexes Fall Down

Binance Futures and Tokensets' DeFi Indexes Fall Down

The Binance DeFi Composite Index which tracks and measures the performance of a basket of DeFi assets  has seen a massive 50% drop since its launch in August. Meanwhile, TokenSets’ DeFi Pulse Index crashed by one-third.

The Binance index allows trading under the DEFIUSDT symbol. In the beginning, Binance’s index hit a high of 1,189 USDT. But at the time of writing, it is trading around 507 USDT only.

The reason for this is that the value of the cryptocurrencies selected for the underlying basket have experienced some price drops. This includes even popular coins like YFI, COMP, UNI, RUNE, ZRX, KAVA, BAL, and more. Moreover, the basket does not contain some of the larger-cap and popular altcoins that caught the DeFi community’s attention.

DeFi Composite Index/USDT: (Source: Binance Futures)
DeFi Composite Index/USDT: (Source: Binance Futures)

Apart from the Binance DeFi index dropping, TokenSets’ DeFi Pulse Index Set (DPI) has lost one-third of its value since its launch on September 15. DPI dropped from $130 in mid-September to its current price of $90.

DPI aims to make it simpler and cheaper for DeFi investors to buy a basket of tokens without manually buying each token. Thus, saving a lot in terms of gas fees. As per DeFi Pulse, DPI consists of the top tokens in the DeFi space by total value locked (TVL). Experts on the DeFi Pulse team are responsible for selecting and weighing the various tokens in the list.

DPI/USD: (Source: CoinGecko)
DPI/USD: (Source: CoinGecko)

On the other hand, DeFi continues to experience some booming moments in its ecosystem. Recently, Ethereum DeFi and decentralized applications (DApps)  reached $100 billion gains in Q3 2020.

To add on, decentralized exchanges (DEXs), particularly Uniswap, recorded $15.371 billion in its September volume, surpassing Coinbase once more. In general, DeFi experienced exponential growth in 2020, in comparison to the previous year.

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