The high-profile implosion of Silicon Valley Bank (SVB) last week sparked a frenzy of decentralized finance (DeFi) transactions, according to market intelligence platform DappRadar.
DappRadar points out in a new report that DeFi tends to be highly susceptible to market concerns and dips.
Last weekend, USD Coin (USDC) lost its peg to the US dollar following news that Circle, the issuer of the stablecoin, had $3.3 billion of its $40 billion reserves trapped in the collapsed BLS. The second largest stablecoin by market capitalization fell as low as $0.8788 before regaining its parity on Monday.
This roller coaster had a ripple effect in the DeFi sector, explains DappRadar.
“On March 11, following the SVB crash and USDC decoupling, the DeFi market saw a significant drop in its TVL, falling 9.6%, from $79.28 billion to $71.61 billion. The news sent investors into a panic, triggering a sell-off and a decline in the TVL.
Fortunately, on Monday the 13th, the USDC reserve deposit held at Silicon Valley Bank became fully available to the public, helping to stabilize the market. This announcement led to a 13% increase in DeFi TVL, reaching $81.15 billion.”
TVL stands for “Total Value Locked,” which represents the total capital held within the smart contracts of a blockchain. TVL is calculated by multiplying the amount of collateral locked up in the network by the current value of the assets.
DappRadar notes that the number of unique active wallets interacting with DeFi contracts increased from 421,026 on March 8 to 477,094 on March 11, an increase of 13%. Transaction count increased 23% from 1,356,483 to 1,668,992.
Decentralized exchange (DEX) Uniswap (UNI) was behind that surge in activity, according to the market intelligence platform.
“Uniswap V3, one of the most popular decentralized exchanges, saw a significant rise in UAW, surpassing 67,000 on Saturday, March 11, with volume of $14.4 billion, the highest figure ever recorded for V3. The 67,000 UAW was the highest recorded for a Uniswap Dapp since the summer of 2021.
Also, Uniswap V3 avg. the transaction size on Saturday was $170,080, almost double the average, indicating that the Ethereum DeFi whales were very active over the past weekend.”
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