Decentralized Finance (DeFi) tokens continued their recovery mode as the crypto fear and greed index rose. The price of PancakeSwap (CAKE) rose more than 30% on Thursday, reaching its highest point since July this year.
In contrast, Synthetix (SNX) price jumped to a high of $2.50, the highest level since August 2023. Once again, like PancakeSwap, the token rose more than 35% from its October low.
AAVE, the world’s fourth largest DeFi platform, rose 16.13%, while Uniswap rose 15%. Other top DeFi tokens such as Curve (CRV), Compound (COMP) and Frax Share (FXS) were also the best performers.
These tokens rose as the crypto fear and greed index jumped to the greed zone of 74. In most cases, cryptocurrencies jump when a sense of fear spreads in the market.
They are also rising due to strong Bitcoin performance. Bitcoin jumped to $34,450 on Thursday, its highest point this year. The economy is up double digits from its September low.
Crypto tokens, also known as altcoins, tend to rise when Bitcoin does well. And fortunately, as I previously wrote, Bitcoin’s rally appears to be gaining momentum as it has formed a bullish pennant pattern.
The coin has also remained above the 50 and 100 day moving averages, while the Relative Strength Index (RSI) has risen to the overbought level. This RSI is a sign that Bitcoin is gaining strong momentum.
They also rose after the Federal Reserve’s latest decision. The bank left the interest rate unchanged between 5.25% and 5.50%, the highest point in more than twenty years. In his statement, Jerome Powell indicated that the Fed will likely continue to pause in the coming months.
Economists also expect the Fed to cut rates in the second quarter of 2024 as well. Cryptocurrencies, which have survived the recent rate hike cycle, are likely to see renewed momentum.
The DeFi ecosystem is also bouncing back. According to DeFi Llama, the total value (TVL) has increased to over $42.7 billion.
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