The recent drop of $HIFI coins came quickly and fiercely, driven by a concentration of multiple negative factors. The most direct reason is the deterioration of the protocol's fundamentals, with the total locked amount plummeting from $120 million to $40 million in just two weeks, and daily income shrinking by 70%. An $8 million loan faces the risk of insufficient collateral, and these figures have directly shaken investors' confidence.
The withdrawal of funds has compounded the difficulties, with on-chain data showing that multiple whale addresses concentrated on selling 12 million HIFI in the past week, worth about $5 million. This large-scale sell-off has breached key support levels, leading to a halving of liquidity pools on exchanges like Binance, and the bid-ask spread has sharply widened from the previous 0.5% to 3%, severely deteriorating market depth.
Meanwhile, emerging protocols like Ethena are aggressively attracting users with higher yields, while HIFI's staking rewards have plummeted from 18% to 6%. This obvious yield gap has led many miners and investors to switch to other platforms. Market sentiment has completely collapsed under multiple blows, with the short position ratio soaring to 75%, and negative news about the sudden resignation of community administrators has triggered panic selling on social platforms.
Currently, the market's focus is on two aspects: first, whether cooperation with mainstream lending protocols like Aave can be introduced to revitalize the ecosystem, and second, whether the team will initiate substantial buybacks to stabilize the coin price. However, given the current situation and the lack of significant improvements in fundamentals, HIFI may still face a difficult period.
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