Cryptocurrency Market Update: Freefall in DeFi screams bubble busting

• The DeFi craze is taking a breather amid massive losses for individual tokens.
• The total value locked in DeFi plunged from $13.25 billion (September highs) to the prevailing $9.42 billion.
• Aave and Yearn.finance fall by more than 40% from their all-time highs.

It has been an exciting year so far in the cryptocurrency industry. First, the market crashed excessively following the COVID-19-triggered selloff in March. Then, investors diversified their attention from Bitcoin and other major cryptocurrencies to decentralize finance (DeFi) tokens.

Projects in the new ecosystem allow investors to borrow and provide liquidity on digital platforms. These assets rallied to new highs, popularizing the DeFi craze. However, the last four weeks have not been kind to the same tokens, with some of them posting monthly losses of more than 40%.

The biggest questions remain, is the DeFi bubble about to burst? Or has it done it already?

DeFi market cap falls below $10 billion

The entire DeFi ecosystem has total value locked of $9.42 billion. The figure might seem high considering how young the sector is but note the drop from September highs of $13.25 billion. A chart provided by DeFi Pulse highlights that recovery seems to be underway from the monthly low of $6.30 billion.

At the time of writing, UniSwap is the biggest DeFi project. It has a total value locked of $1.91 billion, which represents dominance of 20.27%. Over the last 24 hours, UniSwap lost 1.45% of the funds locked.

Maker trails UniSwap with a total value locked of $1.27 billion. Its fund has grown by 1.79% over the last 24 hours. Curve Finance comes in the third position with a total value locked of $1.23 billion, following a 1.83% loss in 24 hours.

Reprinted from FX Street, the copyright all reserved by the original author.