Major DeFi tokens, including UMA, Maker, and Uniswap have surged up to 22% in the past 24 hours. The decentralized finance (DeFi) market has generally rebounded following a sustained pullback.
There are two main reasons behind the short-term recovery of major DeFi tokens. First, most DeFi tokens were heavily sold since September, causing most to show oversold signs. Second, the overall user activity in the DeFi market remains relatively high in spite of the marketwide correction.
UMA, Maker, and Uniswap: DeFi Giants Rebound First
In the past two days, the price of Bitcoin has increased from $11,255 to $11,500, by over 2%. The slight upsurge of BTC buoyed the overall momentum of the cryptocurrency market in a short period.
Consequently, DeFi tokens, which had continuously slumped from September to mid-October, recovered strongly.
UMA, Maker, and Uniswap are the 4th, 5th, and 6th biggest DeFi tokens in the cryptocurrency market. Although smaller DeFi tokens are lagging behind, large-cap DeFi tokens have restored some momentum.
The 1-hour price chart of Uniswap (UNI). Source: UNIUSDT on TradingView.com
Atop various technical indicators that demonstrate the oversold nature of DeFi tokens, fundamentals also suggest a resilient market.
According to the data from intotheblock, a blockchain analytics firm, Compound Finance alone has $1.12 billion in active loans. The highest paying lending pool on Compound is UNI, the native token of Uniswap.
“Compound Finance leads the way in the total value in active loans in lending protocols. The protocol currently has a total of $1.12 billion in active loans. At the moment, lending $UNI in #Compound pays a rate of 13.56%,” intotheblock researchers wrote.
Users in the DeFi market remain active following the steep pullback of major DeFi tokens. UMA, Maker, Uniswap, and other DeFi darlings, such as Yearn.finance (YFI) faced prolonged slumps since early September.
Yet, the total value locked across DeFi protocols is reaching for an all-time high. The revenues of top DeFi projects also remain near previously seen levels last month.
DeFi Market’s User Activity is Still High
Defipulse.com shows that the total value locked in DeFi has exceeded $11.2 billion. It has achieved a new all-time high, depicting the continuous growth of the DeFi space.
On August 1, the total value locked in DeFi just hovered above $4 billion. It has increased by nearly three-fold within a three-month span.
In the upcoming weeks, technical analysts foresee recovery across the DeFi market.
Michael van de Poppe, a full-time trader at the Amsterdam Stock Exchange, said the outlook of YFI and Uniswap remains optimistic.
“Looking ready for continuation upwards, the same goes for $UNI. Would be nice to have some short-term relief on the markets in which upper resistance levels can receive a test. Likely case for those surges to occur coming weeks,” he said.
This post was originally published on www.newsbtc.com