Positive price correlation for BTC and ETH, and record high levels of TVL DeFi

Positive price correlation for BTC and ETH, and record high levels of TVL DeFi

By bit.team

It is not news that Bitcoin and Ethereum are constantly striving for new heights in terms of their price actions. This year’s biggest cryptocurrencies hit new record highs (ATH).

Cryptocurrency market experiences growth

At the time of this writing, Bitcoin was trading at $39,291.35 and Ethereum costs $1,648.15, according to CoinMarketRate. These price figures, currently below the ATH of each cryptocurrency, allow both digital currencies to maintain a combined market capitalization of more than $919 billion, which accounts for more than 76% of the global cryptocurrency market

According to the Glassnode network, both Bitcoin and Ethereum have reached a record high level of actualized market capitalization. The actualized limit for Bitcoin is 227,503,018 270.08$, and for Ethereum – 63,728,636 509.07$.

What is the implemented limit and what does it mean?

According to Glassnode’s description of actualized market capitalization, the indicator is a market capitalization option that values each UTXO based on price when it was last moved, as opposed to its current value. As such, it represents the realized value of all coins on the network, not their market value.

To make this clearer, the cost of BTC bought when the price was $15,000, and now these BTC idle in the wallet, is what is used in calculating the actualized limit, not the current one cost.

So the move to ATH in the realized restriction of both major digital assets shows that more people are now buying them amid heightened valuation. If the realized limit continues to rise, a rise in the price of each asset is inevitable because they are interconnected to some extent.

TVL DeFi is just as at record high

Total blocked cost (TVL) in DeFi protocols is again at an all-time high, which is one of the main factors being the growth of ETH.

The record high was reached on Saturday, February 6, of more than $35 billion, a day after the record high of ETH price, while today it still exceeds 33 billion dollars.

But what’s even more surprising is the rate of growth.

As DeFi Pulse notes on Twitter, just a year ago, the $1 billion mark was marked for the first time in history, yet in just 12 months TVL DeFi has grown a staggering 33 times.

DeFi Pulse also points to another curious fact. Today, all 10 leading DeFi protocols for TVL exceed the $1 billion amount of blocked funds, a threshold that just a year ago applied to the total amount of all protocols DeFi.

So if the DeFi protocol wanted to be in the top ten for TVL, it would have to raise and block more funds than was linked in all existing DeFi protocols a year ago.

Undoubtedly, the boom of the past few days is also linked to the sharp rise in ETH prices, which consistently hit record highs. But that’s not all.

For example, an analysis of price characteristics of tokens associated with DeFi over the last seven days shows that of the top ten, only one showed a result of less than 10% – Uniswap with + 8.7%.

Maker, on the other hand, stands out with + 77%, though, starting from the tenth position down, there are also really sensational performances.

For example, UMA + 172%, Terra (LUNA) + 111%, 0x (ZRX) + 136%. There is none in the top forty positions that have shown negative results in the last seven days.

One particularly interesting case is PancakesWAP (CAKE), whose price rose from $0.7 on January 22 to $3.4 today, up 385% in just two weeks.

Consequently, DeFi is growing not only due to the cost of ETH, but also outside the Ethereum network.