Sonic (formerly Fantom) has entered a bear market, with its price plunging nearly 50% from its recent high—even as its decentralized finance (DeFi) ecosystem experiences record-breaking growth. On Saturday, the Sonic token (S) was trading at $0.50, down from its February market cap peak of $2.8 billion to just $1.48 billion.
The price slump contrasts sharply with the booming DeFi activity on the Sonic network. According to data from DeFi Llama, total value locked (TVL) on Sonic surged to a record $860 million this week, or $1.7 billion when measured in Sonic terms. Unlike other chains, this growth is being fueled by a wide range of decentralized applications.
Top contributors to the rising TVL include Silo Finance with $202 million in assets and AAVE V3, which has amassed $184 million shortly after its launch. Additional key platforms such as Avalon Labs, Shadow Exchange, and SwapX, along with leading liquid staking platforms Beets and Veda, are also driving activity on the network.
One key incentive attracting developers is Sonic’s FeeM program, where over 60 applications are now earning 90% of the network fees generated by their apps. This unique model encourages greater engagement and innovation within the ecosystem.
Further boosting its utility, Sonic recently launched both virtual and physical payment cards accepted by over 130 million merchants globally. Meanwhile, stablecoin provider Circle has hinted at deploying USDC on Sonic, which could elevate the current $255 million in stablecoins circulating within the network.
The bullish developments follow Sonic’s recent rebranding from Fantom, which introduced enhanced performance features such as faster transaction speeds, improved smart contract execution, and reduced costs.
However, despite the strong fundamentals, technical indicators suggest a potential correction. Sonic’s chart shows the formation of a rising wedge pattern and a head-and-shoulders setup, with the neckline sitting at $0.3795. These bearish formations point to a possible breakdown in the days ahead.
As investors weigh the fundamentals against the technical risks, Sonic’s next moves will be closely watched across the crypto market.
