Silicon Valley Bank’s implosion has sent DeFi transactions into a frenzy as crypto assets rallied: DappRadar
The high-profile Silicon Valley Bank (SVB) implosion last week has sparked a spate of decentralized finance (DeFi) transactions, according to market research platform DappRadar.
DappRadar notes in a new report that DeFi tends to be very vulnerable to market concerns and crashes.
Last weekend, USD Coin (USDC) lost its peg to the US dollar after it was revealed that Circle, the stablecoin’s issuer, had dumped $3.3 billion of its $40 billion in reserves into the collapsed SVB. The second-largest stablecoin by market cap fell as low as $0.8788 before retaking its peg on Monday.
This roller coaster ride has had an impact on the DeFi sector, explains DappRadar.
“On March 11, following the SVB crash and USDC depegging, the DeFi market saw a significant drop in its TVL, falling 9.6% from $79.28 billion to $71.61 billion. The news caused panic among investors, leading to a significant sell-off and a decline in TVL.
Luckily, on Monday the 13th, the USDC reserve held at Silicon Valley Bank was fully open to the public, which helped stabilize the market. This announcement resulted in a 13% increase in DeFi TVL to $81.15 billion.”
TVL stands for Total Value Locked, which represents the total capital held in a blockchain’s smart contracts. TVL is calculated by multiplying the amount of collateral tied 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, a 13% increase. The number of transactions increased by 23% from 1,356,483 to 1,668,992.
According to the market research platform, decentralized exchange (DEX) Uniswap (UNI) was behind this surge in activity.
“Uniswap V3, one of the most popular decentralized exchanges, saw a significant surge in UAW, surpassing 67k on Saturday, March 11 with a volume of $14.4 billion, the highest ever recorded for V3. The 67,000 UAW was the highest registered on a Uniswap dapp since the summer of 2021.
In addition, Uniswap V3 avg. Transaction size was $170,080 on Saturday, almost double the average, suggesting Ethereum DeFi whales have been very active over the past weekend.”
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