At the beginning of August 2023, the cryptocurrency market witnessed a notable shift as alt season ended and Bitcoin season takes center stage. Despite Bitcoin’s dominance declining (47.83%), altcoins within the top 50 assets have failed to outperform BTC in the past 90 days, marking the definitive end of July’s alt season. Among the altcoins, however, two DeFi blue chips, MKR and COMP, have emerged as outliers, driving the DeFi Blue-Chips Index 39.7% higher between June and the current period.
The DeFi Blue-Chips Index, a gauge of the top DeFi tokens, has been led by MakerDAO(MKR) and Compound (COMP), standing out among the top eight DeFi tokens. Analysts from crypto intelligence tracker Glassnode revealed that the extraordinary performance of these tokens is primarily attributed to their respective project fundamentals rather than broader market developments.
In June, Compound experienced a significant boost in price, soaring nearly 83% in the week following the departure of its founder and CEO Robert Leshner, who shifted focus to regulated finance. On the other hand, MKR implemented its Smart Burn Engine buyback program, utilizing DAI stablecoins to buy back MKR from the Uniswap pool. As a result, approximately $7 million worth of MKR was removed from circulation within a month, driving the MKR price up by 60%.
At the time of writing, MKR is trading at $1,330, reflecting a 7% increase in the past 24 hours. On the other hand, COMP stands at $63.80, experiencing a slight dip of 0.53% in the last few hours. These figures further emphasize the remarkable growth of these DeFi blue chip tokens in a market that has been largely dominated by Bitcoin, which is currently priced at $29,518.10 with a 24-hour surge of 2.26%.
The recent surge in the DeFi Blue-Chips Index’s market capitalization indicates a clear shift in market sentiment, with investors turning their attention to assets with strong fundamentals. While traders may still engage with meme coins and various DeFi tokens, the dominance of Bitcoin continues to wane, signifying a shift towards more sustainable and project-specific investments.
The alt season tracker from Blockchaincenter.net now confirms the advent of Bitcoin season, as the index reads 27 out of 100. July’s altcoin month has come to a close, with Bitcoin dominating the market, and altcoins failing to outperform the leading cryptocurrency.
In conclusion, MKR and COMP have emerged as strong contenders during this Bitcoin season due to their fundamental development progress. The recent price rallies of these DeFi blue chips stand as a testament to the importance of project-specific updates and improvements. As investors seek stability and sustainable growth in the cryptocurrency market, projects with strong fundamentals are likely to lead the way.