The volume of net assets locked in protocols on various second layer (Layer-2) platforms on the base of the leading altcoin Ethereum (ETH) has fallen in the past two months. Analysts predict possible reasons for this dramatic decline.
Ethereum-based L2 altcoin projects fell 40%
Experienced analyst Patrick Hansen, crypto venture advisor at Presight Capital VC fund, on Twitter Polygon (MATIC), Loopring (LRC) shared the bearish dynamics of Curve (CRV), Immutlable X (IMX) and similar Ethereum-based second-layer platforms:
Ethereum L2s are currently struggling to meet high expectations – L222 meme recalls do you The reality is that L2 TVL is at its lowest this year despite massive liquidity incentives and token farming efforts.
Ethereum L2s currently have a hard time living up to the high expectations – remember the L222 meme?
The reality is L2 TVL is at its lowest this year, in spite of massive liquidity incentives & token farming efforts. pic.twitter.com/YQkxIfL5Ko
— Patrick Hansen (@paddi_hansen) May 29, 2022
Analyst, the total locked value of Ethereum’s L2s (various net worth of assets injected into the protocols) fell to annual lows. In fact, they’ve dropped to $4.4 billion in equivalent. The last time this value was this low was in mid-October 2021.
L2s started losing steam in early April: their TVL has dropped 40% since then. The analyst emphasizes that this decline has occurred despite large liquidity incentives and token farming programs. Therefore, the analyst admits, “We can be sure that it is too early to talk about the L2 breakthrough,” admits
But this year, the Ethereum L2 breakthrough has been definitively accepted by Ethereum-Maxis. For now, this couldn’t be further from the reality, even before the crashes of recent weeks. L2 usage is limited at best.
Questions to answer
At the same time, analyst, second languages, to see the true picture of what is driving the TVL of sophomore students down He concludes that we need to consider the correlation between
As we have covered in the news of Cryptokoin.com , Ethereum’s DeFis are also heavily affected by the ongoing market recession. According to data provided by data aggregator platform DeFiLlama, DeFis lost 40% of TVL in just 30 days. Now, the net volume of assets locked in DeFis stands at $67.92 billion, down almost $100 billion from the historical maximum recorded in November 2021.
