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As Bitcoin’s price continues to surge, the DeFi tokens and most of the altcoin markets are swinging in the red waters. BTC has breakout $14300; it’s the highest price since 2018. The pioneer crypto has continued to perform, despite the recent 5% dump, compared to the stock and altcoin markets.

Market corrections are normal and healthy for the markets. However, time presents serious traders and investors with ample opportunity to re-accuminate the digital assets as they wait for the next bull run. Most of the altcoins are bleeding out, recording double-digits in losses, as per the time of writing this article.

What’s Happening To the DeFi Token Markets?

Digital assets associated with the Decentralized Finance (DeFi) protocol have been booking incredible performance since the crypto market dump in March 2020. Markets like UniSwap and YFI have witnessed parabolic moves in August. Trouble for the DeFi markets and the rest of altcoins started in September when altcoin dominance took a downward trend. The correction in the alternative coins or altcoins market is due to Bitcoin’s continued crypto market dominance. Traders are dumping Defi Tokens for BTC as the anticipated for big market moves. Traders and speculators predict the prices of the decentralized payment protocol to hit $20000 by December 2020.

Bitcoin is currently the dominant cryptocurrency commanding up to 65% of the crypto market with a market cap of $280 billion as 18.4 million BTC are circulating the digital asset markets. The market trend has caused bleeding in most of the DeFi markets as protocol book double-digit losses over the past days. Protocols like Compound, UniSwap, Aave, Synthefix, Bancor, Balancer, and Loopring are lapsing between 10% and 15% in the past 24 hours.

Not all DeFi tokens are in the red territory as assets like Augur’s REP are still green as Hegic makes meaningful market gains. Most of the altcoins in the top ten list of cryptocurrencies’ market cap are bleeding as Ethereum and XRP struggle to stay in the green territories.

The Crypto Market Cap

The entire global crypto market cap is around $410.8 billion, recording a 4.20% increase in the last 24hrs. Crypto markets have booked a 1023.36% increase in 24-hour trading volume, translating to about $974 billion. DeFi markets account for 2.07% of the total crypto market trading volume booking $20.17% billion in the last 24 hours.

What’s Next for DeFi Tokens?

Experts expect a recovery season for Altcoin Markets as a BTC dominance chart shows promising recovery in the altcoin cycle. Traders like Hamada Mark project a bounce of 68 to 70 in BTC dominance triggering a comeback in the altcoins by December of 2020. Others suggest that an upward push in prominence to levels above 66% will reflect a capitulation in most Altcoin markets until BTC cools.

The launch of ETH 2.0, scheduled for DEC 2020, is the most anticipated event by altcoin enthusiasts. Davis Lark claims that this event might significantly impact the crypto markets through his Crypto Lark channel than the Bitcoin halving. Most of the Altcoins, including DeFi protocols, are built on Ethereum. The launch of ETH 2.0 phase zero by the end of the year will see security improvement and gas fee reduction on the blockchain network. Crypto enthusiasts project parabolic market moves on ETH and the entire crypto markets. Most pundits project Ethereum price to hit above $1000 once ETH 2.0 is launched. If the market moves happen to Ethereum, we might see altcoins markets recover and may trigger BTC’s upward price movement. We have seen how the crypto markets correct has greatly affected the DeFi tokens with the current situation in the market. Will the DeFi markets recover with the launch of ETH 2.0?  Time will tell.

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