US bank crisis halts NFT hype while DeFi thrives

by James · March 17, 2023

The recent collapse of Silicon Valley Bank (SVB) and the USD coin (USDC) put a stop to the hype surrounding Non-Fungible Tokens (NFTs) while benefiting decentralized finance (DeFi) activity, as the recent DappRadar report revealed.

During the weekend 11.-12. On March 1, DeFi transaction volume passed $58 billion across all platforms – while March 11 saw the lowest number of active NFT traders since November 2021, according to the DappRadar report.

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DeFi rise

On March 11, following the SVB crash and USDC de-pegging, Total Value Locked (TVL) in DeFi fell to $71.61 billion from $79.28 billion – marking a 9.6% decrease. The number of transactions also increased by 23%, to 1.6 million from 1.3 million.

DeFi transactions count (Source: DappRadar)

After SVB’s USDC reserves were made available to the public on March 13, the DeFi market also stabilized, causing DeFi TVL to grow to $81.15 billion, marking a 13% increase.

The number of unique active wallets (UAW) interacting between DeFi protocols has also registered a 13% increase between March 8 to March 11, growing to 477,094 from 421,026.

DeFi winners

Among all DeFi protocols, Uniswap (UNI) was the one to record the most significant increase in UAW numbers – while 1inch Network (1INCH) won on the trading volume front.

Uniswap’s UAW increased to 67,000 on March 11 from 54,000 on March 10, marking a 24% increase. Trading volume also registered a 96% increase, growing to $14.4 billion on March 11 from $7.34 billion on March 10.

1inch Network, on the other hand, recorded a 304% growth in trading volume, increasing to $3.46 billion on March 11 from $855 million recorded on March 10. The UAW count on the exchange also grew to 24,100 from 21,600 in one. day – an increase of 11%.

NFTs

The NFT market has grown at an impressive rate in recent months. The NFT sphere maintained its resilience during the coldest winter in crypto history and managed to return to pre-Luna crash levels in February.

However, the NFT sphere took a hit from the banking crisis in the US. NFT trading volume recorded a 51% decline since early March, falling to today’s 128,000 from February’s 156,000.

NFT trading volume and sales figures (Source: DappRadar)

The number of active NFT traders was recorded as 12,000, which is the lowest since November 2021. It also recorded the lowest number of trades on a single day of the year, with 33,112 transactions.

Interestingly, the banking crisis did not affect NFT trading volume as much as trading activity. The report justified this contradiction by saying that Ethereum (ETH) NFT whales have continued to farm on Blur Season 2.