{"id":135611,"date":"2024-08-15T19:00:25","date_gmt":"2024-08-15T16:00:25","guid":{"rendered":"https:\/\/cryptodnes.bg\/en\/?p=135611"},"modified":"2024-08-15T13:56:16","modified_gmt":"2024-08-15T10:56:16","slug":"bitcoin-layer-2-hype-collapses-as-assets-and-tokens-plummet","status":"publish","type":"post","link":"https:\/\/cryptodnes.bg\/en\/bitcoin-layer-2-hype-collapses-as-assets-and-tokens-plummet\/","title":{"rendered":"Bitcoin Layer 2 Hype Collapses as Assets and Tokens Plummet"},"content":{"rendered":"<p>Merlin\u2019s blockchain, once touted as a top \u2018Bitcoin layer 2,\u2019 has seen a sharp 63% <strong><a href=\"https:\/\/defillama.com\/chain\/Merlin\" target=\"_blank\">decline<\/a><\/strong> in assets since July 1, according to DefiLlama. This drop is much steeper compared to <strong><a href=\"https:\/\/cryptodnes.bg\/en\/cryptocurrency\/bitcoin\/\">Bitcoin\u2019s<\/a><\/strong> 5% loss in the same timeframe.<\/p>\n<p>MerlinSwap, the primary exchange on this blockchain, has experienced an even more severe downturn, with its total value locked (TVL) <strong><a href=\"https:\/\/defillama.com\/protocol\/merlinswap#information\" target=\"_blank\">falling<\/a><\/strong> by 88%. Additionally, Merlin\u2019s proprietary tokens, MERL and MP, have faced significant losses, with MERL down 84% from its peak and MP dropping 90%.<\/p>\n<p>Since its Mainnet debut in February 2024, Merlin has undergone several rebrands. It now reports a TVL of $2.1 billion for Merlin Seal, though this figure may include inflated or double-counted assets. This represents a 44% decrease from the $3.8 billion value claimed for Merlin Chain on June 6.<\/p>\n<style>\n    .dark-mode .read-more {background-color: #343a40 !important;}\n<\/style>\n<div class=\"read-more pb-3 pt-3 pt-md-2 px-3 my-4 border bg-light\">\n    <h5 class=\"text-uppercase border-bottom mb-3 pb-1 d-none d-md-block\">READ MORE:<\/h5>\n    <a class=\"article row\" href=\"https:\/\/cryptodnes.bg\/en\/will-history-repeat-lessons-from-1995-fed-cuts-for-todays-market\/\" title=\"Will History Repeat? Lessons from 1995 Fed Cuts for Today\u2019s Market\">\n        <div class=\"contentRight col-4\">\n            <span class=\"imgContainer mt-0\">\n                <img decoding=\"async\" class=\"image img-defer\" src=\"https:\/\/cryptodnes.bg\/en\/wp-content\/uploads\/sites\/2\/2023\/05\/economy-growth-prediction-240x170.webp\">\n            <\/span>\n        <\/div>\n        <div class=\"contentLeft col-8\">\n            <h4 class=\"title mb-0\">Will History Repeat? Lessons from 1995 Fed Cuts for Today\u2019s Market<\/h4>           \n            \n        <\/div>        \n    <\/a>\n<\/div>\n<p>Instead of relying on Bitcoin\u2019s proof-of-work for security like many layer 2 solutions, Merlin uses a proof-of-stake system. It primarily uses Bitcoin to demonstrate proof of stake and occasionally updates Bitcoin\u2019s blockchain with aggregated data.<\/p>\n<p>Despite these setbacks, the decentralized finance (DeFi) sector continues to thrive. TVL across DeFi platforms has grown by 54% this year, and the market cap of DeFi tokens has increased fourfold. Merlin could still recover if it shifts away from its outdated &#8216;layer 2&#8217; branding and embraces a new approach.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The excitement around layer 2 scaling solutions is waning as investors realize these are essentially new blockchains.<\/p>\n","protected":false},"author":1,"featured_media":103999,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[24,23],"tags":[],"class_list":["post-135611","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-altcoins","category-blockchain"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Bitcoin Layer 2 Hype Collapses as Assets and Tokens Plummet - Cryptodnes EN<\/title>\n<meta name=\"description\" content=\"The excitement around layer 2 scaling solutions is waning as investors realize these are essentially new blockchains.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cryptodnes.bg\/en\/bitcoin-layer-2-hype-collapses-as-assets-and-tokens-plummet\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bitcoin Layer 2 Hype Collapses as Assets and Tokens Plummet - 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