The growth of the most important of cryptocurrencies in recent days has overshadowed its rivals, mainly altcoins. With its adoption as a reserve asset, Bitcoin showed its power and what some call superiority, over other digital currencies and over DeFi.
The latter suffered a significant loss in their Binance composite index, which fell 60%, the exchange reported. This is the second consecutive month of problems in terms of this index. According to the data, the drop from its all-time highs of $ 1,200 has reached $ 400.
Likewise, Binance ensures that most of the Decentralized Finance (DeFi) tokens have lost 7/10 of their value. In other cases, the profit losses of many tokens have been 90% since last September.
Will the power that Bitcoin displayed be maintained?
It is difficult to doubt that the power that Bitcoin showed during the last days, overshadowed all its rivals. However, the uncertainty remains as to whether the price of Bitcoin will continue to grow or if it will decline to the same extent that the tension in the United States decreases.
It should be taken into account that nervousness took hold of the markets in the face of the uncertainty brought by the US presidential elections. Investors, worried about losing their capital, strengthened reserve assets, including Bitcoin, which caused a significant growth in its value thanks to the massive purchase.
But to the same extent that the political calm returns in the North American country, the price of Bitcoin could fall. It is still early to predict if this is what will happen, but if so, the crypto universe could be returning to the previous situation.
It would be the price of Bitcoin in limbo, while interest in DeFi revives. According to the aforementioned Binance report, this could be the scenario, taking into account that the fall in the DeFi index of 60% can be contrasted with the strength of its Total Blocked Value (TVL), which is around the $ 12.4 billion US dollars.
Few tokens and DApps do well in the index
Beyond the power that Bitcoin showed and the fall of the DeFi in the Binance composite index, it is that for the latter all is not lost. In this sense, 8 tokens stand out, which showed a neutral correlation with Bitcoin from the 45 days prior to November 1.
The same can be said of tokens with respect to Ethereum. The report highlights that 7/13 of them showed a negative correlation with the second most important digital currency. In both cases, both in Bitcoin and Ethereum, the negative behavior “It’s not a surprise”Considering the end of the DeFi bubble, Binance explains.
Regarding the applications of the DeFi ecosystem, the Decentralized Exchange (DEX), Uniswap, remains imposing. Of the $ 12.4 billion of the entire ecosystem, this DEX occupies $ 2.8 billion in volume, which represents 22.66%.
But going back to the protagonist of the last few days, Bitcoin, its power was shown not only in the price. Beyond that, also in market capitalization, the most popular of digital currencies, manifested great superiority compared to other cryptocurrencies.
The capitalization of Bitcoin is located at $ 286.9 billion dollars. This represents a colossal dominance when compared to Ethereum’s $ 52 billion and Tether’s 17.1 billion, its two closest rivals.
All these events open the way to two possible scenarios. In the first, Bitcoin remains the absolute king if its price and its capitalization continue to rise. In the second case, if the political stability in the US pushes its price back, and interest in DeFi is revived, the dominance of Bitcoin would be, at least, a little more shared.
Regardless of this, it seems pretty clear that cryptocurrencies and the Blockchain continue to gain ground.
Data to take into consideration
- The DeFi Composite Index drop on Binance has been from $ 1,200 to $ 400, which represents 60%.
- Bitcoin analysts assured its price growth could reach 20K, however, it stopped at $ 15,900 and fell back.
- At the time of writing, the price of the most important of the cryptocurrencies is $ 15,504.
- The stumble of the DeFi composite index, contrasts with the strength of its TVL, which stands at 12.4 billion USD.