Cryptocurrency aggregator Markets Science co-founder, Twitter user Bitdealer, shared a chart showing a negative correlation between the top 11 DeFi coins and Bitcoin (BTC) in the last 45 days through November 1, with AAVE showing a neutral correlation. UNI showed a fusion of less than 0.1.

Seven out of the 13 DeFi coins have been found negatively related to Ethereum (ETH), despite the fact that Ethereum provides much of the DeFi ecosystem.

With many decentralized economic tokens struggling while Bitcoin’s value rose this week, analysts identified a longer negative correlation between DeFi tokens and BTC.

The 45-day correlation between BTC price and the 13 highest DeFi coin: Bit Trader
However, by the end of August, the sector found a speculative plateau, with the Binance DeFi Composite Index down 64% from $ 1,100 in early September to less than $ 400 at the time of writing.

The DeFi Pulse Index (DPI) has also lost more than half of its value since its $ 130 launch in mid-September. DPI Coins last traded for just $ 61.55.

Meanwhile, the price of Bitcoin rose by more than a third in the past month, rising to $ 14,000 in late October after global payment giant PayPal announced its entry into the crypto sector.

Tyler Reynolds, a payments engineer at Google, believes that bullish activity in the bitcoin markets is diverting speculative capital from DeFi, noting that “key players in DeFi” including Three Arrows Capital and Qiao Wang recently promoted “a difficult rotation history in BTC”. Reynolds estimated that up to $ 50 million could have exited the DeFi market, easing buying pressure in the markets.

Cryptocurrency trader Flood did the same with the Coinist podcast, saying that he did not have “as much exposure as he would have wanted in this bullish move,” and that he considers it “a representation of the market as a whole.”

Trading activity on the decentralized exchanges also appears to have changed, with the DEX monthly volume dropping from nearly $ 26.3 billion in September to around $ 19.4 billion last month.

Few DEXs have a large share of the sector, and Uniswap and Curve account for 75% of the decentralized trading in September. Uniswap volume over the past three months accounted for 45% of the total DEX volume since November 2019.

Source: CoinTelegraph