The decentralized finance ecosystem on Ethereum is at the heart of the news. Not long ago, the COMP token made headlines following the explosion of its course. As expected, the price has since undergone a small correction, but a new challenger comes into play with the Balancer BAL token.
COMP is losing speed
June 15 marked the start of community distribution of COMP tokens for the Compound protocol. Thus, thanks to the concept of Liquidity Mining, all users of the protocol (borrower and liquidity providers) generate COMP tokens.
As a result, the use of the Compound protocol has exploded, so that the protocol has passed the giant MakerDAO in terms of funds involved.
Thus, the COMP price experienced an ATH (all-time high) on Sunday June 21 with a unit value of $ 372. Obviously, the madness could not last indefinitely and the price of the COMP token is already beginning to feel it.
Indeed, it lost about 40% of its value to reach (at the time of writing) $ 224 per unit.
The challenger Balancer
Compound was not the only protocol to launch a governance token distributed through Liquidity Mining. Indeed, protocol Balancer has started the distribution of its token BAL 1 June 2020.
Since the launch, 435,000 BAL have been distributed over the protocol to approximately 1,000 different Ethereum addresses.
Following the same model as COMP, Balancer experienced a dizzying increase in the funds involved in its protocol, going from 15 million dollars equivalent on June 1 to 85 million at the time of writing.
At the same time, on the single day of June 23, the price of the BAL increased by 210% from $ 6.95 to $ 21.57 per BAL. Since then, things have calmed down a bit and the price has not changed much. It is currently at $ 17.42.
However, the addition of the BAL token to the FTX exchange platform could well re-launch hostilities, following the same phenomenon as the addition of the COMP on Coinbase Pro last week.
The craze around these tokens, however, leaves many Internet users perplexed. Indeed, many see it as a new bubble similar to that of 2017 which had propelled the ICOs.