DeFi Crash Hit Binance Smart Chain More Than Ethereum: Messari

In brief

  • The DeFi market is slowing down as the entire crypto market slumps.
  • Binance Smart Chain has been the biggest loser, according to Messari.
  • Polygon, on the other hand, did well in Q2.

Binance is having a tough go of things recently. It’s lost partnerships with payment processors, has had to limit onramps to its platform, and is being blocked by banks.

If that weren’t enough, its Binance Smart Chain is also losing the race to overtake Ethereum as the go-to blockchain for decentralized finance (DeFi), the group of experimental products that provide loans, interest, and asset swaps without banks or other intermediaries. 

The DeFi world exploded in popularity last year, and some people who jumped on the bandwagon early made a lot of money. But according to a report released today by cryptocurrency data provider Messari, things have slowed down in Q2 2021. And Binance Smart Chain took the brunt of it.

In its Q2 2021 DeFi Review, Messari writes that “DeFi protocols saw activity decrease in the second half of the quarter as speculation in markets died down.” Messari notes that volume on decentralized exchanges (DEXs) in particular was up from April through June, jumping from $221 billion to $405 billion. (DEXs are DeFi applications that allow you to swap tokens—but unlike crypto exchanges like, say, the hugely popular Coinbase, they allow trading without a middleman.)

While that initially looks positive, volume slumped toward the end of the quarter. 

And slumped hard. In May, the monthly DEX volume was $203.5 billion; in June, it had halved to $95 billion, according to Messari data. (Though that monthly figure is still good enough for the third-best haul of all time.)

The disproportionate loser of May’s market crash, said Messari, is Binance Smart Chain (BSC), the blockchain kickstarted by the world’s biggest crypto exchange, Binance. That extends to DeFi applications in its orbit, including PancakeSwap, a DEX built atop BSC that rivaled Ethereum’s Uniswap in terms of active users during points of Q1.

“Combined with a series of hacks and exploits on BSC leading to hundreds of millions of dollars in losses, BSC saw speculation dry up dramatically in June leading to PancakeSwap volumes diving 69% in June,” wrote Messari.

BSC may have been a victim of short-term thinking, suggests Messari. It notes that most investors using BSC products were using “mercenary capital” for crypto tokens that had “little use outside of incentivizing user speculation,” too. In short, BSC was being used to make a quick buck. 

BSC’s loss has been Polygon‘s gain. The Ethereum-based project is a scaling solution that seeks to address some of the blockchain’s major limitations by speeding up transactions and making transactions cheaper. 

“The rise of Polygon also played a significant role in eating away Binance Smart Chain’s (BSC) share of decentralized exchange volumes,” the report said. “As the party shifted towards Polygon, with its new set of tokens to speculate on and farms to harvest, BSC was squeezed out of the picture.”

The report added that UniSwap v3, an update to the original Ethereum-based DEX launched in May, has firmly reestablished itself as king of the DEX market. “Uniswap v3 now accounts for more than 40% of all DEX volume and continues to eat the DEX market, showing no signs of slowing down,” Messari said. 

Binance’s DeFi ecosystem has had a good run, but Ethereum seems to be reasserting its traditional dominance. And with Binance entrenched in regulatory battles and partner deflections, it just may not have the bandwidth to focus on DeFi.


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ChainSwap Loses $8 Million In Second Exploit

ChainSwap has experienced another exploit in what has turned out to be a terrifying month for the exchange. The platform which acts as a bridge for assets had succumbed to an exploit earlier this month, and now, only eight days later, ChainSwap has succumbed to another exploit. This time, the attacker made away with $8 million before it was shut down.

The attack was carried out using the token ASAP, affecting a wide variety of tokens and projects in the process. The ChainSwap team had taken to Twitter to warn their users to not purchase the platform’s native ASAP token for the time being while the team carried out their investigation into the hack.

Related Reading | Ledger Scam: Scammers Mail Hacked Ledger Devices To Steal Crypto

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The exploit led to some coins like WILD losing almost all of their value, before promptly recovering back up. The price of WILD had fallen 99.8 percent following the attack but the price has since recovered.

This attack comes on the heels of the first exploit on ChainSwap eight days earlier which had seen the attacker make away with $800,000 in the hack. The ChainSwap team had given a post-mortem report on the attack but there is yet to be a follow-up on that attack.

What Is ChainSwap?

ChainSwap is a cross-chain bridge that acts as an intermediary for multiple chains. The bridge supports the Ethereum network, MATIC, and the Binance Smart Chain. A cross-chain swap enables the trading of tokens by users without the need for an intermediary or a third party like exchanges.

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ChainSwap enables holders to trade coins from different blockchains without having to go through an exchange like Binance. For example, a holder can trade their coins that are on the Ethereum blockchain for coins that are on the Binance Smart Chain without ever needing to deposit their coins in an exchange. This means that traders can trade a variety of coins in one go no matter what blockchain their coins or tokens are based on.

Total DeFi market cap from

Total DeFi market cap from

Total DeFi market cap above $60 billion | Source: Crypto Total DeFi Market Cap on

This also means that coins that are not listed on any exchanges can be traded on ChainSwap. Smaller projects which are just starting out are traded by holders for other coins on cross-chain bridges all the time and it has become a very popular way of trading coins in the market.

Given this, there are a lot of small projects and tokens on ChainSwap, and those projects have been affected following the second hack.

Token Projects Suffer In Second Hack

Several projects took to their official accounts to announce how the ChainSwap hack had affected their tokens and their projects. The hack which affected a lot of projects included Wilder World, Nord, Razor, Antimatter, and a host of other coins which had seen their projects take hits from the exploit.

Projects like ROOM announced that they had seen a $550,000 loss from the attack and had to make a quick decision to pull all liquidity.

Related Reading | How Hackers Looted 2600 ETH In Rari Capital Cross-Chain Exploit

The Umbrella Network (UMB) also announced that they planned to buy back $230,000 worth of UMB tokens and would leave it up to the community to decide what would be done with the tokens. Umbrella Network also said that it would be pulling from ChainSwap and will no longer rely on the decentralized finance platform for token bridging.

The ChainSwap team announced after the hack that they had frozen the Binance Smart Chain mapping token address in order to identify the addresses of the attackers. ChainSwap has assured its users that their tokens are safe, although send and withdrawal functions have been suspended for the time being.

The price of ASAP saw a sharp decrease in its price following the hack. But the price has since recovered. Although the ETH-BSC bridge remains paused at the moment.

Featured image from Epiq, chart from


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Bitcoin Showing Signs of Potential Bounce: Crypto Analytics Firm Santiment

Prominent crypto analytics firm Santiment is revealing some potential signs that Bitcoin may be ready for a bounce up in price after weeks of sideways trading. 

Santiment shares two metrics on Twitter with its 77,600 followers that suggest Bitcoin sellers are starting to lose steam. 



“The amount of daily inflow of Bitcoin to known exchange wallets, as well as the total supply of BTC on exchanges, have experienced a sharp 50-day drop, which may point to diminishing sell-side pressure.”

Source: Santiment

Additionally, Santiment points out that Bitcoin’s funding rate on the crypto exchange BitMEX has veered positive as traders remain indecisive as to whether Bitcoin’s price can recover. The analytics firm indicates that this pattern of negativity and excess shorting has usually been matched by quick price bounces every time it sinks too low. 

Source: Santiment

According to Santiment’s chart, a positive BitMEX funding rate tends to align with Bitcoin rallies.

The analytics firm is also keeping an eye on Ethereum (ETH), noting that its fees – which are at seven-month lows – don’t seem to have an effect on Ethereum’s rise in utility.

“Ethereum’s average fees are down to $2.19, which is the lowest the #2 market cap asset has been since December, 2020. This is a promising sign that ETH’s utility can rise with little impact of fees standing in the way of healthy circulation.”

Source: Santiment

At the time of writing, Bitcoin is trading at $33,062, while Ethereum is sitting just above $2,000.

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Bulls largely absent as Bitcoin price slips to the bottom of its range near $32K

Within the past few hours, a fresh wave of selling pushed Bitcoin (BTC) price close to the $32,000 support level as the low trading volume and general disinterest from traders saw the price revisit the lower section of its current range.

BTC/USDT 4-hour chart. Source: TradingView

The price of Ether (ETH) also fell under pressure alongside Bitcoin as the building momentum ahead of the network’s upcoming London Hard Fork failed to support a price above $2,000, resulting in a daily low of $1,918.

Bitcoin’s compression range tightens

Some insights into the current market conditions were offered by Gas Fring, a pseudonymous Twitter account, who posted the following tweet highlighting previous instances of range-bound trading for BTC.

As shown in the chart below, Bitcoin price has a tendency to trade within a consistent range following significant price moves, with previous instances lasting up to 132 days as was the case in late 2018 to early 2019.

BraveNewCoin liquid index for Bitcoin 1-day chart. Source: Twitter

The current compression range has lasted 55 days with a tighter range between $30,000 and $36,500 being seen since June 19.

According to Gas Fring, in the previous instance of a “layered stricter compression” seen in Q4 of 2018 and in the summer of 2020, the period of tighter compression “lasted for roughly half the overall period.”

“This tells me that we might have another 2 weeks or so of such inner tighter compression which will take the periods to 34 and 68 days respectively.

Related: Nonfungible tokens soar even as Bitcoin price drops close to $32,000

Altcoins hit hard as Bitcoin continues to struggle

The altcoin market was hit hard by the afternoon sell-off, leaving few coins in the green as traders hastily made for the exits.

Daily cryptocurrency market performance. Source: Coin360

Nonfungible and gaming tokens like Axie Infinity (AXS) and Small Love Potion (SLP) continue to be the bright spot in an otherwise gloomy market, putting on gains of 22% and 35% respectively as new users embrace the daily income opportunity provided by the blockchain-based trading and battling game.

Other notable gainers include a 16% increase in the price of Phala Network (PHALA) and a 15% gain for MyNeighborAlice (ALICE).

The overall cryptocurrency market cap now stands at $1.314 trillion and Bitcoin’s dominance rate is 46.1%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risk, you should conduct your own research when making a decision.