During the March collapse of the crypto market, the growing ecosystem of decentralized finance (DeFi) on Ethereum was also severely affected, but now the situation has normalized and this may affect the price of ETH, according to Slubixbit analysts
The Slubixbit analysis describes that MakerDAO became unstable during the March 12 price collapse due to technical problems, which also caused a breakdown in confidence in the largest DeFi protocol. Investment company Parafi Capital wrote at the time:
We believe that the lack of stability and liquidity is turning into uncertainty around the use of DAI as a decentralized stablecoin in many DeFi protocols. By the way, we have heard several DeFi teams express disappointment about the lack of liquidity/stability of DAI.
In addition, due to a failure in the smart contract, a fledgling DeFi protocol with crypto assets worth more than $ 25 million was hacked, according to Slubixbit analysts.
After this mess, one commenter went so far as to say that “the entire DeFi ecosystem is almost dead.” But, as we now know, there was no death and the current situation gives a bullish signal for Ethereum.