🦄 Cash Flow Analysis - Is LAYER 2 in a "dead zone"?
Currently, the weakest cash flow sector that people should pay special attention to is Layer 2. The cash flow picture here shows a clear depletion with no signs of capital inflow, no growth signals, and has almost completely lost its attractiveness to the market. If there is one exception, it is only ARB POL which still maintains a bit of remaining appeal, while all others fall into a state of emptiness.
Looking at the GML2 Index chart representing Layer 2 tokens, we see:
On July 12, cash flow peaked at 99 points, reflecting the highest level of interest in the year.
But by April 17, it had dropped to only 27.5 points, a straight decline, signaling a strong and decisive withdrawal of cash flow.
The most recent recovery peak on October 5 only reached 41 points, and has now fallen to 34, too low to create expectations for a recovery cycle.
This shows that Layer 2 is no longer a safe haven for cash flow, at least in the short term. Not only Layer 2, but also the sectors of DeFi, Gaming, and DePIN are experiencing the same weak cash flow situation, low liquidity, and are not creating waves.
🤩 Meanwhile, Layer 1, Meme, and AI are the three sectors leading the recovery, with a strong cash flow attraction generating new momentum for the market. If in the upcoming growth phase, the three main cash flows mentioned above are satisfied, where will the next cash flow rotate?
Layer 2, DeFi or DePIN, what do you think?
Could this be an accumulation zone to gather before becoming the next explosion point? Please give your opinions and suggestions?
