The crypto community's attention has switched to the DeFi sector, which has been experiencing a strong spike, signaling the end of the crypto winter, with the price of Bitcoin hanging above $50,000. This change in direction is mostly due to the widespread interest DeFi has received during the current AI frenzy.
The importance of platforms like Uniswap and others that allow users to lend, borrow, or exchange cryptocurrency without the need for a central authority to step in has increased as a result of several creative initiatives.
It would seem that the DeFi tokens could reach new heights and create quite a stir during the impending bull run.
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Maven11 Capital's Gains in Strategic DeFi
Maven11 Capital has demonstrated the possibility of wise profits in the cryptocurrency venture market throughout current DeFi surge. Maven11 Capital, which made a calculated investment in DeFi tokens, has achieved an impressive 54% return, or $1.43 million.
This success story started with the acquisition of 100,000 UNI tokens from Binance at a price of $5.74 each, which were subsequently sold for $11.2, yielding a $546K 95% gain.
Investments in other tokens, such as MKR, AAVE, and FXS, have also produced noteworthy returns of 38%, 58%, and 43%, respectively, demonstrating the profitable prospects in the DeFi industry.
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A Proposal for Uniswap's Governance Drives the DeFi Rally
This spike is being driven, in part, by Uniswap's recent plan to compensate token holders. To improve the governance of the system, the proposal recommends paying protocol fees to UNI holders who stake and assign their tokens.
This endeavor, directed by Uniswap Foundation governance lead Eric Koen, caused a 70% increase in UNI tokens and is expected to bring life back to the network's decision-making process.
Apart from Uniswap, COTI (COTI) has increased by more than 38%, and SushiSwap (SUSHI) has increased by more than 36%.
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Trends in Liquidity Indicate Growing DeFi Optimism<
A strong trend in the Total Value Locked (TVL) on Uniswap was noted in a recent Glassnode analysis, indicating growing optimism in the DeFi industry. The liquidity profile of tokens outside the Top 50 noticeably increases during the altcoin season, indicating growing investor interest in long-tail coins.
The current situation is shifting even though bear markets usually witness liquidity concentrating in the top 50 tokens, where the majority of transaction takes place. Liquidity for the Top 10 tokens—mostly WETH, WBTC, and stablecoins—has increased by 5.14%, and for the Top 20, it has increased by 10.9%.
The departure from tokens numbered 20 to 50, however, suggests a calculated change in investor focus toward possibly higher-yielding assets.
Redistributing liquidity suggests that investors are becoming more comfortable with the idea of diversifying their portfolios with a wider range of assets, which is indicative of rising market confidence. It may indicate that investors are keeping an eye out for long-tail assets.
In conclusion, the next bull run in the DeFi space is expected to yield substantial growth.