Explore why the SUI price may soon crash as the total value locked (TVL) in DeFi decreases and a rising wedge pattern forms

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After the Federal Reserve made a hawkish interest rate decision, Sui's price fell sharply and then rebounded alongside other altcoins. It is one of the best-performing cryptocurrencies this year, rising 440%. Now, with the total value locked (TVL) in DeFi protocols for Sui tokens and the number of developer commitments decreasing, will the price of Sui tokens crash?

With DeFi TVL declining, SUI price faces crash risks

Sui's price was $4.56 on Wednesday, close to its all-time high of $4.9. One of the reasons for its surge is the rising amount of assets in its DeFi protocols, which has now exceeded $1.7 billion. This growth makes it the ninth largest blockchain in the industry. It is larger than other popular blockchains like Avalanche, Aptos, and Polygon.

However, the continued surge in DeFi assets is mainly due to the sustained rise in Sui’s price, which has boosted its asset amount. After peaking in September this year, the TVL measured in SUI has been on a downward trend. It has dropped from $730 million in SUI to the current $385 million, the lowest level since April. This indicates that its DeFi protocols are underperforming, which could theoretically affect its price.

Decrease in SUI network commitments and core developers

Another potential risk for SUI price is the decline in the number of submissions by developers. Submissions refer to the changes made by developers and saved to the network. Ideally, more submissions indicate more network activity. 

Data shows that the number of submissions in December was 950, down from the peak of 5.3k in May last year. The peak for this January was 2.93k, and the trend is not optimistic. The number of core developers has decreased from a high of 86 this year to 44.

However, Sui has also seen some positive fundamentals. For example, its on-chain stablecoin trading volume has risen to over $377 million. The trading volume of its DEX protocols (such as Cetus, Bluefin, Kriya, and DeepBook) is also quite strong.

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