TVL, Fundamental Analysis, Supply and Demand

“Crypto market trends -a deep dive in fundamental analysis, TVL, offer and request”

As the Cryptocurrency world continues to grow in popularity, investors are always looking for the next big thing. A key metric who has made titles lately is “TVL”, short for the total blocked value. But what exactly does it mean? How do you interpret this metric? And can it be a useful tool for fundamental analysis?

What is TVL?

TVL refers to the total amount of value blocked in cryptocurrency projects, such as decentralized finance protocols (Defi) and non-functioning market markets (NFT). Essentially, it is a measure of how much money invested in these projects, which can be attractive to investors who are looking for high yields of their investments.

Fundamental analysis: Basic items

When it comes to a fundamental analysis, it is essential to consider the basic economic and technical data that determines the price of a cryptocurrency. This includes values ​​such as:

* Earnings: How much does the project that generate income from its users cost?

* market capitalization:

What is the total value of all the tokens issued by the project?

* The growth rate: The project is facing a constant growth or is it a plateau?

Analyzing these fundamental data points, investors can better understand how a cryptocurrency is carried out and if it is due for a correction.

Offer and request: Psychology behind price movement

The concept of supply and demand is also crucial in the world of cryptocurrencies. This idea suggests that prices are determined by the balance between those who want to buy (request) and those who want to sell (offer).

* Buyers:

Investors are interested in buying chips at current prices or waiting to fall?

* Sellers: Investors sell their chips, reduce prices?

When the demand is high and the offer is low, prices tend to increase. Instead, when the opposite appears, prices tend to fall.

TVL interpretation: A key indicator

TVL offers a valuable perspective on market feeling. Because more value is blocked in projects, it indicates that investors are increasingly optimistic about their investments.

* Increased TVL: This may indicate an improvement in the general economic perspective and increasing investor confidence.

* Decreased TVL: On the other hand, this could signal concerns about the sustainability of the project or a decrease in investors appetite for more risky assets.

However, note that TVL is not the only measure to consider. Other factors such as market capitalization, growth rate and adoption rates should also be considered when making investment decisions.

Conclusion

In conclusion, TVL understanding is essential for investors who want to make the knowledge of the case about their cryptocurrency investments. Analyzing fundamental data points, such as winnings, market capitalization and growth rates, you can get a better feeling of how a project is carried out and if it is due to a correction.

However, TVL should be considered together with other values, such as market capitalization and adoption rates to achieve a more comprehensive understanding of the cryptocurrency market. By applying the fundamental analysis and taking into account the offer and the request, investors can make more informed decisions about their investments and can maximize the profits of their investments.

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