Cosmos token is on track for its fourth week in the red as its demand dries up and as the crypto industry faces challenges. ATOM dropped to $4.8 on Friday, its lowest point since 2021 and almost 90% below its highest point on record.
Cosmos has lost market share
Cosmos, which used to be one of the biggest cryptocurrencies in the market, has continued losing market share in the industry. Its total market cap has dropped from over $10 billion in 2021 to $1.7 billion.
Data shows that Cosmos has seen its volume drop in the past few years. For example, the network had a 24-hour volume of $123 million, a figure that is smaller than other smaller cryptocurrencies. Floki had a volume of $140 million while ThorChain had $227 million and Fantom had $211 million.
The same is happening in the futures market where its open interest has dived in the past few months. Its open interest stood at $69 million on Friday, down from $120 million in May and $271 million in 2021.
Open interest is an important metric that looks at the volume of unfilled orders in the futures market.
Cosmos has lost appeal because crypto traders have been focusing on the meme coin industry lately. That has shifted demand to Solana, which has become the go-to blockchain for these coins.
Also, the network’s growth has stalled as shown in the number of transactions in the network. Cosmos had 1.3 million transactions in the past 30 days and just 45,000 on Thursday this week, meaning that its ecosystem is slowing.
Additionally, Osmosis, its biggest DEX platform, has seen the amount of value locked in the ecosystem tumble to $85 million from over $1.4 billion a few years ago.
On the positive side, Cosmos has one of the biggest staking yields in the market. The yield has jumped to 18% while the staking ratio has crossed the key point at 60%.
Cosmos price analysis
The weekly chart shows that the ATOM price has been in a strong downtrend in the past few months. Most recently, the token lost a key support as it dropped below the key support at $5.53, its lowest point in May 2022.
ATOM has remained below the 50-week moving average while the momentum indicator has tilted downwards. Therefore, the path of the least resistance for the Cosmos price is downward, with the next point to watch being at $3.5.
