Even though various cryptocurrencies have recently gone through an intense week, there is still lots of work ahead. For most DeFi assets, reaching a new all-time high remains well out of reach. Of course, things can always change, but it seems unlikely any significant price increases will occur now.
DeFi Projects Struggle Value-Wise
Compared to the recent all-time highs the majority of DeFi assets recorded, things look a lot less exciting now. When Bitcoin and Ethereum decided to drop 50% of their value in a few days’ time, the rest of the market had to follow suit. A lot of that damage is still visible today, even for some of the top decentralized finance projects on the market. Reaching a new all-time high seems very unlikely for most of these currencies, at least in the short term.
Per Crypto Rank, several top DeFi assets are still over 50% removed from their all-time high. In the case of ThorChain (RUNE), that gap is 755.5% due to some recent unfortunate developments for that ecosystem. Even industry giant ChainLink is still 63.1% removed from its all-time high, which comes as a surprise to many traders and speculators. LINK was once poised to hit $100, but that now seems months, if not years away again.
The same goes for Terra, Aave, Maker, and Compound. They all have to make up 53.1% or more to reach a new all-time high. It is not impossible in an industry where daily gains of 15% are far from an exception. However, it will all depend on how Bitcoin and Ethereum perform at the time. So far, their momentum is not entirely promising, as stability remains challenging to come by.
Synthetix also has its work cut out with a 67.5% deficit over the recent all-time high. This gap persists despite SNX going up by 32.8% in the past 30 days. Top DeFi assets got hit hard during the recent crypto flash crash and will take a while to approach all-time high values once again. That can still happen in 2021, as there are five months left in the year.
Not All Hope Is Lost
It is worth noting other DeFi projects noted an all-time high not that long ago. It is easier for new tokens to do so, for obvious reasons, but it still provides a glimmer of hope in an otherwise semi-dark landscape. Of course, whether one should invest in these small-cap currencies is a very different matter, as DeFi projects come and go every day.
That said, projects that are within 10% of their all-time high can prove worthwhile. It all comes down to whether there is a long-term vision by the team. Moreover, any project offering something different from the norm can be a good one, as many facets to DeFi remain unexplored today. It isn’t all about yield farming, liquidity mining, and staking, after all.
The coming months will be rather intriguing for all cryptocurrency markets. There’s still much-lost value to recover, and some assets may try to decouple from Bitcoin and Ethereum. Several others have tried to do the same in the past yet came up short. It is tough to do, but the DeFi industry needs to stand on its own legs to succeed.