The cryptocurrency market, Web3, and the decentralized application (Dapp) sector were all rattled by the sudden collapse of the FTX crypto exchange and all of its associated organizations. From business as usual to filing for bankruptcy and conducting fraud investigations in less than seven days shook the market.
Indeed, the rapid collapse of FTX and the currencies linked with it, which were once worth a combined total of $32 billion, such as FTX Token (FTT) and Solana (SOL), startled the sector. However, Web3 has shown remarkable resilience over the previous two weeks; despite an 11.67% reduction in activity, there were still 1.9 million daily Unique Active Wallets (UAW) and over 25 million transactions recorded, according to the latest data by DappRadar shared with Finbold on November 17.
Notably, the Dapp space keeps going strong, with 1.92 million dUAW connected in the last seven days. DeFi UAW activity peaked on November 9 and 10, reaching roughly half a million UAW on both days; DeFi activity is currently reverting to prior month levels (400,000 dUAW). With 814,305 dUAW during the last two weeks, gaming Dapps seem particularly resistant to the FTX slump.
There were no significant swings in activity among the various gaming networks (EOS, Hive, Wax, Ronin, and IMX). Over the previous two weeks, activity in Arbitrum has climbed by 26.36%, reaching an average of 24,443 dUAW. During the same period, Polygon’s (MATIC) activity level averaged 148,752 dUAW, an increase of 7.11 %.
The total value locked decreased
Since November 1, the overall value of assets locked up in DeFi systems has decreased by $20.60 billion, falling from $83 billion to $65 billion. As the total value locked (TVL) goes up, it shows that more coins are being deposited inside the DeFi protocols, which is a sign of positive sentiment. On the other hand, when the TVL goes down, it shows that investors are taking their money out of the ecosystem.
The TVL of Ethereum (ETH), the leading TVL blockchain, dropped from $51 billion on November 1 to $41 billion on November 13, a fall of 14%. The ETH staking returns on Lido, the biggest Ethereum liquid staking service provider, have grown to a record high of nearly 10.16%. The stETH has decoupled from Ether and is now trading at $0.9883.
Furthermore, Binance’s native token (BNB) TVL is down 14% to $7.3 billion. The total value of Tron’s TVL fell from $6.1 billion to $4.6 billion, a decline of 25.05%. TVL also dropped by 25.06%, 8.76%, and 10.26% in Avalanche, Polygon, and Arbitrum, respectively.
Cronos activity hit 15,000 dUAW and 25,000 transactions on November 13 after concerns that Crypto.com may be bankrupt. Its TVL has dropped 19% in USD in the last two weeks but has risen 45% in CRO.
The value of TVL dropped the most on the Solana blockchain. Dropping from $1.65 billion to $585 million is a 64.66 percent decline in US dollars but a far smaller 18% decrease in SOL.
The value of the SOL token has also decreased significantly compared to its rivals during the last two weeks, plummeting by 59.36% to a price of $13.25.
The token’s value had increased momentarily after the rumor that Binance was considering purchasing FTX, but it decreased when Binance decided to back out of the deal. Binance gave the reason that they were investigating charges of mishandling customer funds.
Anatoly Yakovenko, the co-founder of Solana Labs, has repeated in a tweet his positive position on the network despite recent losses, even though SOL has recently been confronted with a number of problems.
NFT trade volume declined by 25%
Elsewhere, with a 24.50% drop in sales over the last two weeks, DappRadar suggests it’s apparent that the NFT market is far from over and that the recent decline in trading volume is related to socioeconomic issues rather than a drop in collector interest.
During the FTX meltdown, the prices of many NFT collections fell precipitously. Since November 1, sales (24.50%) and trading volume (68.6%) on the NFT have significantly plummeted. However, a significant portion of it may be attributed to the decline in the value of the associated blockchain tokens.
However, the value of the blue-chips collections has remained the same, despite seeing an average reduction of 9.78% in ETH value or 30% in USD value.
Web3 continues despite the FTX debacle
The blockchain technology that underpinned FTX and many other creative ventures that are revolutionizing the financial system and economies is still going strong. Not flinching, the tech carried on serving users, and anybody could still send and receive assets.
However, concerned customers of cryptocurrency exchanges have prompted such businesses to double-check their reserves to ensure they have enough cash to honor withdrawal requests.
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