- DeFi tokens may show another uptrend soon.
- DEX trading volumes provide insight into future DeFi trends.
- Once DEX trading volume like Uniswap’s bounces back, DeFi “altcoin season” may progress.
After a massive surge in price, decentralized finance (DeFi) tokens are now off to a bumpy road. But investors may continue to expect that these tokens will show another uptrend soon.
DeFi tokens that have been on the rise for the last two months have begun to drop gradually. Analytics platform Santiment explained that trading volume on decentralized exchanges (DEXs) provides insight into future trends within the DeFi sector.
The crypto assets within the DeFi sector have been particularly struck by the recent crypto market downturn. The analyst noted that once this downtrend in volume has been broken, it could be a sign that a leg higher is imminent for these growing digital assets.
The article mentioned,
We believe there is a fundamental metric that could possibly confirm the altcoin season quite early…More people trading means the crowd gets excited. In the middle of the cycle people will be talking about it everywhere again.
Once the trendline below is broken, it could be a sign that another round of DeFi trend is approaching. Leading Uniswap DEX has recently made history as the first DeFi protocol to reach $2 billion in total value locked (TVL).
Previously, it has been observed that Bitcoin’s price recovered as DeFi tokens struggled to hold their positions. Probably, another round of “altcoin season” powered by DeFi will move forward. This might be the result of DEXs like Uniswap bouncing back its trading volume.
Still, DeFi is one of the fast-growing sectors in the crypto space. With various DeFi platforms available in the market, DeFi saw an amazing run as its TVL surged way above $9 billion.
In spite of the DeFi downtrend, the crypto market also faced multiple crypto exchange hacks throughout the past month, including Eterbase’s $5.4 million hack and KuCoin’s $150 million hack.