The price of Hedera Hashgraph ($HBAR ) has experienced a significant decline recently, reflecting the broader downturn in the cryptocurrency market. HBAR fell to a low of $0.2483, mirroring losses seen in major cryptocurrencies such as Bitcoin ($BTC ) and Ethereum ($ETH ). This downturn has pushed the total market capitalization of all cryptocurrencies to approximately $3.24 trillion.

Decline in Hedera’s DeFi Ecosystem

The retreat in HBAR’s price aligns with a notable reduction in the total value locked (TVL) within its decentralized finance (DeFi) ecosystem. Data from DeFi Llama indicates that the TVL has dropped from a year-to-date peak of 1.35 billion HBAR to 675 million HBAR. In U.S. dollar terms, the TVL has fallen from $209 million on December 3 to $165 million, signaling that investors are withdrawing capital from key Hedera DeFi platforms such as SaucerSwap, Bonzo Finance, and HbarSuite.

This trend is not isolated to Hedera, as other prominent blockchain networks, including Cardano, Ethereum, and Solana, have also experienced similar capital outflows amidst broader market weakness.

Long-Term Growth Drivers for Hedera

Despite the current challenges, Hedera Hashgraph holds several fundamental strengths that could support long-term growth. The network benefits from high-profile partnerships with major global companies like IBM and Google, both of which are members of its governance council.

Additionally, Hedera is positioning itself as a leader in the burgeoning Real World Asset (RWA) tokenization industry. Tokenization involves converting traditionally illiquid assets into liquid, tradable forms, and Hedera’s fast transaction speeds and low costs make it an attractive platform for developers operating in this space.

Another potential catalyst for HBAR’s price is the prospect of a spot HBAR exchange-traded fund (ETF) gaining approval from the U.S. Securities and Exchange Commission (SEC) in 2025. A senior Bloomberg analyst suggests that the SEC may approve this ETF, as HBAR is not classified as a security under current regulations.

Technical Analysis: Bullish Patterns Emerge

The daily price chart for HBAR reveals the formation of bullish technical patterns that could signal a rebound. Notably, HBAR is developing a falling wedge pattern, characterized by a narrowing consolidation between two downward-sloping trendlines. Historically, this pattern often precedes a bullish breakout when the trendlines converge.

In addition, HBAR is forming a bullish pennant pattern, which typically occurs after a strong upward movement, followed by a period of consolidation. This pattern is also associated with subsequent bullish breakouts. Furthermore, HBAR remains above the 50-day moving average and the key support and resistance pivot point of the Murrey Math Lines at $0.1953.

Potential Scenarios for HBAR

If the bullish patterns hold, HBAR could rebound and potentially retest its year-to-date high of $0.3940, representing a significant gain of approximately 66% from current levels. However, this optimistic outlook would be invalidated if the price falls below the critical support level at $0.20.

In conclusion, while the near-term outlook for Hedera Hashgraph reflects the broader challenges facing the cryptocurrency market, its robust fundamentals and emerging bullish patterns suggest the potential for recovery and growth in the longer term.

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