Andre Cronje’s Sonic token is in freefall, having erased almost $1.3 billion in market capitalization since its relaunch in January.
Sonic (S) price crashed to $0.3775 on Sunday, down by over 61% from its highest point this year. This crash has brought its market capitalization to $1.9 billion, down from $3.15 billion in January.
Sonic token has plunged as its ecosystem continues slowing down. Data shows that the stablecoin market cap has plunged to $446 million, down from $597 million earlier this year. A falling stablecoin supply in a chain signals that activity in the network is fading.
Further data shows that Sonic’s total value locked in its decentralized finance has plunged from nearly $2 billion in May to $1.53 billion. Most of this weakness was driven by outflows from AAVE, Sio Finance, Pendle, and MEV Capital, which have shed over 10% in assets in the last 30 days.
This slowdown means Sonic is not making as much money as it did a few months ago. Its daily chain revenue dropped to $9,600 on Saturday from a record high of over $42,000 in May.
Sonic token has also dropped as the funding rate across all exchanges has turned negative in the past few months.
Santiment data shows that the funding rate fell to 0.05% on Saturday, its lowest point in over a week. A falling funding rate signals that investors anticipate its future price to be lower than the spot one.
Sonic crypto price technical analysis
S price chart | Source: crypto.news
The 12-hour chart shows that the S price has been in a free fall in the past few weeks.
It plunged to a low of $0.3810, a key level that coincided with the lowest swing in April. This price was also the neckline of the double-top pattern at $0.6185.
A double-top is one of the most popular bearish signs in technical analysis.
The Sonic token has remained below the 50-period moving average, while oscillators point downwards. Therefore, it will likely continue falling as sellers target the support all-time low of $0.3151, its lowest point in February.