In a worrying development, EthereumPoW’s decentralized finance (DeFi) Total Value Locked (TVL) has dropped to an all-time low. Recent network metrics show a dramatic drop in on-chain activity, presenting a grim picture for the popular blockchain platform.
According to DefiLlama data, EthereumPoW’s TVL has dropped by 97% since its introduction nine months ago. Initially, the network saw a boom in TVL, reaching a record high of $6.78 million on October 29, just a month after its September 2022 launch. Unfortunately, a downward trend has subsequently prevailed, with EthereumPoW’s TVL falling by 76% this year alone.
To put things in perspective, the leading DeFi project on the EthereumPoW network is LFGSwap, which has a TVL of $95,040. However, even this project has had a 96% decrease since November 2022. Eight of the fifteen protocols on the chain experienced TVL drops in the last week, with one dropping as low as 85%.
Concerns about network mining have also emerged since data from 2Miners.com shows a steady fall in EthereumPoW’s hash rate. The chain’s hash rate is at 11.06TH/s, down 33% since the beginning of the year and an astounding 83% since September 2022.
As expected, the decrease in mining activity on EthereumPoW has resulted in a matching fall in the chain’s mining difficulty. The network difficulty is 147.47T, representing an 82% decrease since the switch to a Proof-of-Stake (PoS) consensus process in September 2022.
A decrease in hash rate and mining difficulty usually indicates a decrease in the number of miners operating in the network. Several variables, like decreasing mining rewards or a fall in the value of the mined cryptocurrency, could contribute to this.
Despite the difficulties, EthereumPoW has seen a surge in new addresses in the previous 24 hours. According to OKLink data, 426,681 new addresses were created on the blockchain, raising the total number of addresses to 351 million. It is worth mentioning, however, that less than 1% of these addresses were active throughout the same period.
The native coin, ETHW, is currently trading at $2.02. Unfortunately, it has dropped 2% in price and 33% in trading volume in the last 24 hours.
EthereumPoW is at a crossroads, dealing with a drop in DeFi TVL, mining activity, and trade volume. The issues it faces necessitate immediate attention and action from the EthereumPoW community to solve the factors behind this downward trend. Only by working together and making strategic decisions will EthereumPoW be able to reclaim its status as a successful blockchain platform for decentralized finance.