The Significance of Total Value Locked (TVL) in DeFi
To understand the strength of a blockchain in the decentralized finance (DeFi) sector, one metric that is often used is the Total Value Locked (TVL). TVL represents the amount of cryptocurrency assets locked within a particular blockchain or decentralized application (DApp). It indicates the level of trust and confidence users have in the platform and its ability to secure and grow their investments.
Comparing Base and Cardano through TVL
When we consider the TVL of Base, a newcomer second-layer blockchain, and Cardano, a well-established veteran in the crypto scene, we can gain valuable insights into their performance and market position.
Base’s TVL Surpassing Cardano
Despite being just a month old, Base has already managed to surpass Cardano’s TVL by a significant margin. According to Parul Gujral, Base’s TVL is currently three times larger than Cardano’s. This indicates that Base has quickly gained traction and attracted considerable investments, despite its short lifespan.
Market Cap Decline for Cardano
Furthermore, recent statistics from Token Terminal reveal that Cardano’s market cap has experienced a decline of over 10% in the past month. This translates to a nearly $5 billion decrease in its fully diluted market cap. It’s important to note that a fully diluted market cap represents the total market value of all available tokens, while a circulating market cap only considers the tokens currently in circulation.
Base’s Glitch and Recovery
Although Base has shown impressive growth, it hasn’t been without its challenges. Just a month after its launch, Base experienced a glitch that temporarily halted block production for about 45 minutes. However, the Base team quickly identified and resolved the issue, ensuring the security of users’ funds and restoring normal block production.
Hot Take
The comparison between Base and Cardano highlights the dynamism of the crypto market, where a newcomer can quickly gain momentum and surpass established players. It also emphasizes the importance of measuring a blockchain’s TVL and market cap as indicators of its success and investor confidence.
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