Lido TVL hits new ATH: Did LDO feel the impact?

• Lido TVL reached new historic highs driven by higher APR incentives.
• LDO bulls struggled to regain control despite observing bearish weakness.

It has been a rough few weeks for crypto bulls as they struggled to maintain dominance. Meanwhile, Lido [LDO] just registered its highest TVL in its history, which translates to good news in terms of the market’s overall health.

Read about Lido’s [LDO] Price Prediction 2023-24

A healthy TVL indicates that the market has confidence in the long-term prospects. This is because investors are more willing to hold on to their coins and earn some passive income as they wait for the long haul.

Source: DeFiLlama

Lido’s TVL recently peaked at 8.31 billion ETH, thus securing a new all-time high. While this confirms a healthy long-term approach, there is another reason why staking confidence is growing. Lido’s APR grew to 3.86% as of 11 August, hence providing a higher staking incentive.

11/08/2023

📈 APR: 3.86%

🏦 Total staked: 8,052,631.18 (+29,220.74) $ETH

🤑 Rewards
CL: 690.61 (+1.02%) $ETH
EL: 255.01 (-5.58%) $ETH
Total: 945.62 (-0.85%) $ETH

📤 Withdrawal requests
Finalized: 56 (5,945.23 $ETH)
Pending: 9

💻 New validators: 509

— Lido Digest (@LidoDigest) August 11, 2023

LDO’s price action has been moving inversely compared to the TVL. The latter, therefore, has not had a significant impact on the token’s price. To recap. LDO bears have recently been showing signs of exhaustion after maintaining a downward trajectory since mid-July.

LDO long short-term sellers dominate the market

LDO’s price chart indicates that there was some accumulation earlier in the week, according to the MFI’s uptick. It reflected in the form of a bit of a bullish relief which was short-lived, as LDO bears regained control in the last two days.

LDO exchanged hands at $1.83 at the time of writing.

Source: TradingView

LDO’s latest performance confirmed that the bullish performance was not strong enough to sustain more upside. It was worth noting that the price could also dip lower if market conditions remain bearish.

If that happens, LDO will encounter the next support level below the $1.70 price level.

As far as on-chain metrics are concerned, LDO’s mean coin age maintained a steady uptick. This confirms that sell pressure observed in the last few days is from short-term sellers, while long-term holders maintain their resolve.

Source: Santiment

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Lido’s network growth has been lagging despite its TVL surge. This reflected the overall condition in the crypto market which has been characterized by lower volatility. Also, exchange inflow activity has been on the rise since 8 August.

Source: Santiment

The exchange inflows registered more activity compared to exchange outflows during the same period. This a reflection of the sell pressure that has prevailed in the last few days, undoing LDO’s previous rally attempt.