Falling Ethereum gas fees, the launch of Convex Finance and the DeFi sector reaching a potential bottom back CRV’s impressive 150% rally since May 23.
DeFi tokens and protocols took a heavy hit on May 19 as Bitcoin price dropped to $30,000 and while BTC has entered what some analysts describe as a ‘compression’ phase, the total value locked in DeFi and the value many of the sector’s tokens have yet to rebound to the levels seen before the market crash.
Curve DAO token (CRV) stands among the few DeFi tokens that have seen a strong recovery over the past two weeks due to reduced Ethereum gas fees, the launch of Convex Finance and the DeFi sector beginning to find a bottom.
Data from Cointelegraph Markets Pro and TradingView shows that CRV has increased 55% since June 1, rallying from a low of $1.76 en juin 1 à un sommet intrajournalier à $2.76 en juin 3 alongside a 250% increase in 24-hour trading volume.
Convex Finance launch attracts CRV holders
One source of the sudden rise in price and momentum for CRV is Convex Finance (CVX), an optimizer for the Curve Protocol that enables swaps of similar assets like stablecoin to stablecoin transactions.
Introducing Convex Finance! A new platform, built by Defi Natives, to simplify your Curve-boosting experience to maximize your yields.
Read more here! https://t.co/65Dog7RdqE
— Convex Finance (@ConvexFinance) avril 15, 2021
Since it’s official launch on May 17, the Convex protocol has rapidly gained a substantial user base thanks to yields as high as 52.16% and some analysts have suggested that the protocol is challenging Yearn.finance for CRV-related deposits.
Data from Defi Llama shows that in the two and a half weeks since the launch of Convex Finance, la valeur totale bloquée (TVL) on the protocol has surpassed $2.3 billion with stakers on the protocol earning $4.3 million in total revenue.
Both Convex Finance and Yearn.finance rely heavily on CRV for the operation of their platforms and the increased activity has resulted in a decline in the circulating supply of CRV. This may have helped to boost CR price as investors clamor to stake tokens for the highest return possible.
Curve Finance and the wider DeFi ecosystem could also be benefitting from the sharp decline in gas fees on the Ethereum (ETH) réseau, which had previously priced out many retail traders from performing the simple approval and confirmation transactions required to stake and claim earnings from DeFi protocols.
Lower fees have allowed a wider range of users to re-engage with their favorite DeFi protocols, and Curve has been a significant beneficiary of this development.
Les VORTECS™ indicator flashed before the breakout
VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for CRV on May 31, avant la récente hausse des prix.
Les VORTECS™ But, exclusif à Cointelegraph, est une comparaison algorithmique des conditions historiques et actuelles du marché, dérivée d'une combinaison de points de données incluant le sentiment du marché, volume d'échanges, mouvements de prix récents et activité Twitter.
Comme le montre le graphique ci-dessus, les VORTECS™ Score for CRV registered bullish readings throughout the past week with a high of 77 coming late in the day on May 31. This was roughly 15 heures avant la remontée du prix 55% au cours du prochain 48 hours days.
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La source: Cointelegraph