oxDAO appears to have kicked off 2022 with an increase in Total Locked Volume (TVL) which reached $4.4 billion in the month of January. However, since then, the popularity of the platform seems to have faded as the TVL of the platform has decreased almost 20 times and is currently valued at USD 230 million.
0xDAO witnessing a drop in TVL
oxDAO is a “coalition of major protocols on Fantom” that aims to maximize returns for Solidly LP depositors and veNFT holders, depending on their official documents. According to data from DéfiLlamathe platform’s TVL has fallen nearly 20x from January highs.
The data also confirms that in the middle of the first week of March, we saw a huge drop in TVL which stands at $3.5 million. Since then, the TVL has steadily increased. Compared to this value, the TVL of 0xDAO jumped by 6,500% in the month of March!
Initially, the OXD token saw a price spike as it was valued at $0.2 and the TVL also soared. But, the values continued to fall and the cause of the drop in TVL of 0xDAO has to do with Andre Cronje’s new automated market maker (AMM), Solidly which also saw a huge increase in TVL, previously reported by Kripteu Magazine. However, the project was abandoned by the founder which then went wrong.
The war for control
Cronje decided to distribute the governance of the Solidly project according to the TVL of the projects concerned. As a result, there was confusion which led to a dispute where 0xDAO competed for control of Solidly, with the closest competitor being the Solidex exchange. Synapse Protocol confirmed it would delay/go solo, SpookySwap confirmed neutral while Frax Finance joined 0xDAO.
Victory? Not enough. pic.twitter.com/5jWQNZflb6
— alexcutler.eth (@wagmiAlexander) February 24, 2022
As 0xDAO confirmed its advance, users of the platform noticed that the project team had fallen silent, which was not a message well received by the community. This caused users to dump OXD tokens, which also led to a huge drop in TVL.