It is not news that the banking crisis in the United States has impacted the cryptocurrency market, especially the Silicon Valley Bank (SVB) crisis, which caused some stablecoins to momentarily lose their parity with the dollar. But a recent report by the DappRadar platform detailed the impacts on other sectors of the crypto market, decentralized finance (DeFi) and non-fungible tokens (NFTs). According to the analytics platform, the instability of the stablecoin USDC – which peaked at $0.87 – sent shockwaves across the industry. The main beneficiary of this banking crisis was the DeFi sector, whose transaction volume surpassed US$ 58 billion (R$ 305.5 billion) in all protocols last weekend. On March 11, shortly after SVB collapsed in what was the second-largest bank failure in U.S. history, Uniswap V3 reached an all-time high in the number of daily unique active wallets (67,500), averaging $170,080 ( BRL 896,000) per transaction. Meanwhile, NFT trading has cooled down. March 11th was the day NFT traders were the least active (11,440) since November 2021.
Impact of the banking crisis on stablecoins
As highlighted by DappRadar, the collapse of the SVB has shaken the stablecoin market. The biggest hit was USDC issuer Circle, which had nearly 8% of its $40 billion holdings in SVB. After the stablecoin decoupled from the dollar, panic spread through the crypto community. The price of the digital currency rebounded after the intervention of US regulators in the SVB collapse. On the other hand, TrueUSD (TUSD) and Dai (DAI) stablecoins saw significant growth in supply over the same period. Net inflows totaled 57.4% and 27.4%, respectively. Other stablecoins such as Tether (USDT) and Frax (FRAX) also saw slight growth in supply. Read also: BIS announces crypto market intelligence platform in the face of the collapse of DeFi and stablecoins
Impact of the Banking Crisis on DeFi
According to the report, shortly after the SVB crash, the DeFi market experienced a significant drop in its total locked value (TVL) – assets that circulate between DeFi projects. TVL fell 9.6% from $79.28 billion to $71.61 billion. But on Monday (13), when the market stabilized, the amount blocked rose 13% to US$ 81.15 billion. Additionally, the number of unique active wallets (UAW) interacting with DeFi contracts increased by 13%, from 421,026 to 477,094, between March 8th and March 11th. The industry highlight was the decentralized exchange Uniswap V3. DEX experienced a significant increase in UAW, surpassing 67,000 on March 11 – the highest number since 2021. Likewise, popular DeFi aggregator 1inch Network saw a record $3.4 billion in transaction volume on the 11th.
Impact of the banking crisis on NFTs
NFT trading volume continues to cool, having declined by 51% since the start of the month, with sell count down 15.88%. “With the whole situation revolving around volatile stablecoins, NFT traders have become less active, with Saturday seeing fewer traders (12,000) since November 2021 and the lowest single-day trade count in 2023 (33,112)” , told DappRadar. Despite this, the bottoms of top-tier NFTs like BAYC and CryptoPunks were little affected, with only a slight dip below $100,000 on March 11.
