- Synthetix price tilted lower as challenges to the ecosystem emerged.
- The total value locked in its ecosystem has dropped to $529 million.
The Synthetix price remained under pressure on Thursday as the total value locked in the ecosystem continued dropping. The SNX token is trading at $2.85, which is a few points below this week’s high of $3.48. Its market cap has fallen to about $626 million, which is sharply lower than its all-time high of over $3 billion.
Synthetix demand falls
The downfall of Terra’s ecosystem has had a major negative impact on the DeFi industry. The main challenge is that many holders of DeFi assets now believe that their coins could become worthless in a flash. This explains why the total value locked in the industry has dropped from over $250 billion to about $108 billion.
Synthetix Network is a leading player in the DeFi industry. The platform, which was started in Australia, helps people launch synthetic assets of all types. These assets include forex, commodities, and stocks. It uses Chainlink’s oracles to ensure that its assets are accurate.
Learn more about how to buy Synthetix.
Synthetic assets are an important part of the blockchain industry. For one, they make it possible for developers to create platforms that make it possible for people to trade regular assets in a decentralized format. Some of the most popular synths in the ecosystem are sUSD, sETH, and sBTC among others.
Synthetix also recently launched perpetual futures through its Nunki release. A perpetual futures is similar to traditional futures contracts with the main difference being that they don’t have an expiry date.
Recently, however, demand for these synths has declined. According to DeFi Llama, Synthetix TVL has been in a downward spiral with no end in sight. It has dropped from an all-time high of almost $3 billion to $529 million.
Synthetix is not alone. ThorChain, a product that offers synthetic assets has also seen its TVL crash from over $531 million in April to 191 million.
Synthetix price prediction
Turning to the four-hour chart, we see that the SNX price has been in a strong bearish trend recently. It found a strong support at $2.40 in May. And this week, it has formed a small triple-top pattern and moved slightly below the 25-day moving average.
Therefore, with activity in its network falling, there is a likelihood that the Synthetix price will continue falling as bears target the key support at $2.40.
