DeFi Market Plunges As Ethereum [ETH] Corrects Over 12%

By Bhushan Akolkar
Published September 5, 2020 Updated September 5, 2020
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DeFi Market Plunges As Ethereum [ETH] Corrects Over 12%

By Bhushan Akolkar
Published September 5, 2020 Updated September 5, 2020

After a massive bull-run over the last month, Decentralized Finance (DeFi) sector has entered a major correction. Over the last 24 hours, some of the top DeFi tokens have headed south with weekly losses surging above 20%. In this flash crash, over $3.5 billion dollars have been eroded from the overall DeFi market cap.


Over the last few weeks, the massive surge in the popularity of “Yield Farming” protocols like Compound, Aave, SushiSwap and yEarn pushed the DeFi market to new highs. This got prices of DeFi tokens like COMP, LEND, $SUSHI and YFI skyrocketing. The promise of high-interest rewards and governance tokens lured investors in big numbers.

However, some industry experts recently warned about the steep rise in the price of Yield Farming tokens. Ethereum co-founder Vitalik Butern gave a warning signal asking investors not to underestimate the DeFi risks.

DeFi Tokens Showing Sharp Moves

The YFI coin that powers the blockchain protocol has lost over 15% in the last 24 hours. At press time, YFI is trading at a price of $21,975 with a market cap of $423.7 million. Earlier this week, YFI coin was trading above $38,000 surging past a market cap of $1 billion. However, it has lost more than 50% valuations from its weekly high.

Chainlink (LINK) continues to dominate the DeFi market but has corrected 7% in the last 24 hours and over 24% in the last seven days. The major drag down in the DeFi market was by $SUSHI coin, the DeFi coin powering the SushiSwap protocol. Recently SushiSwap gained much popularity after it positioned as the yield farming version of the decentralized exchange Uniswap.

$SUSHI coin crashed a whopping 53% in the last 24 hours. The crash happened after reports emerged that Chef Nomi, the anonymous founder of SushiSwap is reported to have cashed his entire $SUSHI holding.

Interestingly Ether (ETH) has also dropped over 12% in the last 24 hours. At press time, ETH is trading at $345 with a market cap of $38.8 billion. The Ethereum blockchain is home to a majority of the DeFi protocols in the market.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Bhushan Akolkar
717 Articles
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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