Ethereum Classic’s TVL recovers and here’s the key driving factor

Ethereum Classic sees a surge in TVL fueled by increased activity from one of its DEXes. ETC bulls make a comeback but market conditions will dictate its next move.

Ethereum Classic (ETC) just concluded a bullish week but its price action is not the only aspect that achieved a pivot. Its total value locked also registered some upside after previously experiencing outflows.

ETC had a $363.982 TVL, at the time of writing, which represented a significant improvement and pivot from its $279,884 low in February.

But despite this noteworthy improvement, Ethereum Classic’s TVL was immensely dwarfed by Ethreum’s impressive $28.93 billion TVL. ETC’s anemic TVL is a rough indicator of just how far behind the network is in the DeFi race.

Source: DeFiLlama

A major reason for Ethereum Classic’s TVL shortfall is that it has not been very successful in attracting DeFi projects to run on its network.

Nevertheless, there is one particular protocol running on the Ethereum Classic network that seeks to change that. The HebeSwap decentralized exchange currently accounts for most of Ethereum Classic’s TVL.

The amount of TVL that HebeSwap contributed to Ethereum Classic peaked at $236,928 after surging by 42.87% in the last 7 days.

It had the highest gains out of the DeFi projects currently running on the Ethereum Classic network.

The DEX recently expressed its commitment to improving ETC’s ecosystem through the latest addition, a farm APY pool.

Ethereum Classic (ETC) price action

ETC bounced back by as much as 25% from its weekly low to its weekly high. Its 40% gain from its current monthly low is even more impressive. It traded at $21.12 at press time.

Source: TradingView

Can ETC sustain the rally for the next few days? Its latest upside has so far pushed above the 50% RSI level which means relative strength is now leaning in favor of the bulls. Multiple on-chain metrics also support this observation.

The weighted sentiment metrics remained high after the rally it secured in the last 7 days. In other words, investors are still optimistic about ETC’s bullish prospects.

Investors should also note that the price volatility metric ended last week with a pivot. It remains to be seen whether this volatility surge will carry the momentum forward for the next few days.

Source: Santiment

More good news from the NFT side of things. Ethereum Classic’s total NFT trades volume registered a surge in the last few days. A confirmation that the demand for NFTs on the network was also enjoying improved health.

Source: Santiment

Although these are favorable observations, Ethereum Classic’s development activity demonstrated signs of weakness during the weekend.

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