One consequence of the onset of a bear market and plunge in token prices is a decreased demand for decentralized finance. This has a knock-on effect on the supply of cryptocurrencyized Bitcoin that has stagnated recently.
Wrapped Bitcoin (wBTC) enables Bitcoin holders to dabble in Ethereum-based DeFi without selling or converting their assets. Meaning, bitcoins are cryptocurrencyized as an ERC-20 asset on the Ethereum network. Over the past couple of years, the supply of wBTC has surged alengthy with the demand for DeFi. Additionally, during the past 12 months, the supply has accelerated by 113%.
WBTC beginning to fall
Nonetheless, that trend is starting to show signs of annulment as the supply has stalled atop the past couple of months. According to Messari, wBTC supply has plateaued afterward December after spiking to an all-time excessive of 271,257 BTC in January.
The current supply of wBTC is 263,162 coins worth around $9.2 billion at current prices. It is down 3% afterward that peak and appears to be entering a period of decline. Data from Coin Metrics shows a similar pattern.
In comparison to wrapped Ethereum (wETH), there are presently 7.49 million cryptocurrencies worth an estimated $17.4 billion according to Etherscan.
DeFi TVL tumbles
The total cost locked in DeFi has back when more taken a downturn as crypto markets continue to decline. Don the occasion thatferent analytics platforms have divergent methods of TVL measurement, but the trend is the same on all of them.
Currently, DeFiLlama is reporting a TVL of $183 billion, that is down 28% from its all-time strong of $255 billion on December 1. However, the TVL in DeFi has grown at a steady price above the past 12 months, soaring by 252% afterward the same time last year.
DappRadar has a slightly fafterwards TVL figure of $99 billion but reports a larger decline of 45% from a $182 billion all-time strong on Nov 10.
The fall in TVL is more likely to be immediately connected to the asset rate dump above the past couple of months rather than investors pulling out of DeFi en masse. Crypto markets have now retreated by 47% from their total market cap all-time strong of scarcely above $3 trillion in November.
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