February 5, 2023

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Total Value Locked is an important value that determines the popularity of any given DeFi project and the interest of investors in it. Ethereum is facing more hardships as the date of the merge with the Beacon chain approaches. Over the last 6 months, the TVL lost over 65% and now reached about $34.5 billion, a very low number compared to the all-time high in January when it got very close to $101 billion.

One of the reasons TVL sees a drop of such a large magnitude is the poor performance of many Dapps that form the DeFi industry. During this ongoing crypto winter, many DeFi projects have seen a significant reduction in use. While they perform relatively well, especially considering the harsh realities of the current market situation. Nevertheless, DeFi projects are starved of investments and have to operate in a very limited scope.

TRON, Binance, Solana, Avalanche, and many other ecosystems are also suffering due to the underperformance of their dApps that also do not receive enough liquidity and attention from both individual and institutionalized investors. Ethereum also has a plethora of dApps operating within its network. MakerDAO, Lido, Uniswap, and Curve Finance lost significant portions of TVL causing a ripple effect that adds to the continuous loss of TVL by Ethereum.

The situation seems dire, but the network is still performing quite well and remains the biggest ecosystem for dApps with the largest TVL. It is a promising statistic, especially given the anxiety of the whole ETH community waiting in anticipation for the merge that will change the whole network dramatically and may affect many ecosystems that are directly related to the Ethereum network.

The price of the token has been moving horizontally and has tested the $2000 resistance level multiple times in the middle of August. However, it dipped to $1450 at the end of August and struggles to overcome the new $1550 resistance level. Some analysts say that the worst-case scenario for the asset is $400 by the end of September if users of the network won’t be satisfied with the results of the merge.

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