Hedera’s TVL shows growth, but there’s more than meets the eye
- Hedera’s TVL showed growth.
- However, its development activity declined along with its NFT trade volume
On 27 November, Messari, a crypto analytics firm, tweeted that Hedera’s TVL had grown by 171% over the last quarter. The majority of Hedera’s spike in TVL was driven by SaucerSwap, a decentralized exchange on the Hedera network.
.@Hedera ended Q3 with $100M in TVL (171% increase QoQ).
The increase in TVL was primarily driven by the launch of Hedera’s first decentralized exchange, @SaucerSwapLabs. pic.twitter.com/VZBzfJnPzt
— Messari (@MessariCrypto) November 26, 2022
Read Hedera’s [HBAR] Price Prediction 2022-2023
However, despite Hedera‘s growing TVL, other on-chain metrics suggested a grim outlook for the network. Regardless, short sellers may find an opportunity to take advantage of these developments and make a profit.
With an increasing number of crypto users switching from centralized exchanges and moving to DEXes, SaucerSwap may grow in terms of users in the coming quarter.
All that glitters is not gold
Despite Hedera’s growth in terms of TVL, the token fell short to perform well in other areas. For instance, dApps such as HeliSwap witnessed a decrease in terms of unique active users, which fell by 15.46%.
Furthermore, from the image below, it can be observed that Hedera’s development activity decreased significantly over the last few days. Coupled with that, Hedera’s volume declined from 12.5 million to 9.44 million in the last week.
In fact, in terms of the NFT market, Hedera underperformed. According to Stocktwits NFT, a data and discovery platform for NFTs, Hedera’s NFT volume fell by 24% on 26 November. The decreasing volume of NFTs could signal a decline in interest in Hedera from the NFT community.
Another negative indicator for Hedera would be the increasing volatility of HBAR. Hedera’s volatility observed a massive spike over the last few weeks. Thus, suggesting that it was risky for traders to buy HBAR, at press time.
That said, at the time of writing, HBAR was trading at $0.049. Its price had declined by 16.90% in the last 30 days. However, despite the drop, Hedera still increased its market cap dominance and captured 0.14% of the overall crypto market, at press time.
