The demand for loans through the decentralized finance protocols (DEFI) sank sharply due to the recent agitation of the cryptography market, a sign of generalized disappointment such as cryptographic investors that bother risk positions.
The average performance of the US dollar establishment, which the protocols pay to the lenders for providing their assets, fell to 2.8% on Tuesday to their lowest level in a year, measured by the application vaults of defi yield profits. That is well below the average rates of the US dollar monetary market in traditional markets (4.3%), and a strong decrease in the peak of the cryptocurrency market of mid -December, when defi rates exceeded 18%.
“This is largely due to the market progressing towards a risk environment where loans between the protocols have decreased significantly,” said Ryan Rodenbaugh, CEO of Wallface Labs, the team behind the vaults. Fyi.
The measure reflects the spread of risk feelings in cryptographic markets, with investors removing leverage in the middle of volatile price swings. As users pay loans and liquidations, they eliminate sub-collateralized positions, the demand for loan splashes. Meanwhile, the deposits available for loans for protocols were stable, according to the vaults. Data, which means that the decrease in the income of the borrowers extends between the same number of lenders, exerting a downward pressure on the yields.
It is a “double negative smoothie” for the rates that the remaining lenders pay them, Rodenbaugh said.
The strong decrease in yields and disappointment was exacerbated by the butcher shop of this weekend in cryptographic markets, since the main loan protocols defi reported a wave of liquidations in the midst of the prices of assets quickly falling. Bitcoin (BTC) and Eth of Ethereum, two assets used predominantly as a guarantee for cryptographic loans, suffered 10% -15% decreasing below $ 75,000 and $ 1,500, respectively.
AAVE, the largest decentralized loan market for total blocked value (TVL), prosecuted more than $ 110 million in forced settlements during the decrease in the market on Sunday and Sunday, Omer Goldberg, CEO of the analysis firm Defi Chaos Labs, mentioned citing data in the chancica.
Sky (previously Makerdao), issuer of the $ 7 billion of the USDS Stablecoin and one of the largest loan loan platforms, also settled the DAI loan of $ 74 million of a collateralized ether for 67,570 ETH, with a value of $ 106 million at the time, the data in the chain are shown. Another great lender with 65,000 ETH in guarantee hastened to pay portions of its loan of $ 66 million to avoid a similar destination, reducing the outstanding debt to $ 28 million.
The total value of the assets provided in AAVE fell to $ 10 billion on Tuesday, a strong fall of more than $ 15 billion in mid -December, as shown by defillma data. Morpho, another key loan protocol, saw a fall similar to $ 1.7 billion of $ 2.4 billion during the same period, for mandating.
