Thursday, December 9

Unstoppable DeFi: $ 234 billion in deposited value


Decentralized finance (DeFi) is at new all-time highs, surpassing $ 234 billion in deposited value (TVL). According to data from DeFi Llama, the DeFi ecosystem has grown more than 2,000% in the last year. As of mid-October 2020, the cumulative value across all the protocols of this digital financial ecosystem was just $ 9.8 billion.

Total Deposited Value (TVL) in DeFi on all blockchains. Source: DeFi Llama

DeFi and deposited value

Since its inception, DeFi has been gaining popularity and growing in adoption as an alternative financial system. Thanks to the accessibility they offer to decentralized financial products and services, the value within DeFi has increased exponentially. The bullish sentiment surrounding the crypto market today, especially Bitcoin and Ethereum, is also propelling DeFi towards new all-time highs. The protocols of this financial ecosystem that have grown the most in the last 7 days are developed in the Ethereum and Binance Smart Chain blockchains.

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DeFi growth on Ethereum

According to DeFi Llama, one of the largest data providers in the crypto industry, Ethereum is the leading blockchain in the DeFi ecosystem, with a total of $ 157.76 billion in TVL. Ethereum has 270 active decentralized protocols, many of which have seen growth in deposited value of up to 500%. MochiFi, Hundred Finance, DeFi Swap, Reserve and Pods Finance are the five fastest growing decentralized protocols in terms of TVL within this network. However, MakerDAO, Curve Finance, Aave, Compound and Yearn Finance are still the ones with the highest amount of TVL, accumulating more than 48% of the total value deposited in Ethereum.

Ethereum Decos Ecosystem and Binance Smart Chain.

DeFi ecosystem within Ethereum and Binance Smart Chain. Source: DeFi Llama

In the Binance Smart Chain, the protocols Mint Club, UnoRe, Cobra Swap and Qubit are the ones that lead DeFi within this chain of blocks; registering growth in its TVL of up to 250% in the last week. The number of DeFi protocols in BSC currently reaches 131 projects.

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Decline of Ethereum’s dominance

Although Ethereum is the blockchain with the highest TVL in DeFi, its dominance has declined considerably in the last year. As of October 2020, Ethereum’s decentralized protocols accumulated close to 98% of all TVL in the DeFi ecosystem. Currently, that amount has been reduced to 67%. The reason is none other than the arrival of new blockchains focused on scalability. This is the case of the Binance Smart Chain, Solana, Terra and Avalanche. In addition to second layer protocols, such as Polygon and Arbitrum.

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Ethereum is the blockchain for the development of DApps and smart contracts par excellence, thanks to its high level of security, but its low scalability and constant increases in the price of gas have led many users to explore new alternatives. In the last year, the TVL of the Binance Smart Chain went from $ 13 million to 20,380 million today. In Solana, the total value deposited has grown 8.000% since March of this year, exceeding 12.7 billion dollars. At Terra and Avalanche, growth has been 1.400% and 3.600%, respectively, in the same period. As a curious fact, Terra’s TVL exceeds 10,070 million dollars, with only 8 active projects within its DeFi ecosystem. Colin Wu, known as Wu Blockchain, highlighted the record reached by Terra on his Twitter account.

Tokens de DeFi

DeFi tokens have also seen exponential growth in the last week. According to data from CoinMarketCap, KeeperDAO (ROOK), Secret (SCRT), ThorChain (RUNE), Fantom (FTM) and Convex Finance (CVX), they appreciated between 35-65%.

Bitcoin price stabilizes and ethereum hits all-time high

Bitcoin surpassed $ 67,200 per unit this week, fueled by ETF news in the United States. Also, as JPMorgan analysts pointed out, current inflation levels influence the price. However, the main cryptocurrency in the markets seems to be stabilizing at 60K. Analysts anticipate that investors could start spreading their bitcoin earnings in altcoins, potentially raising the value of many tokens in the decentralized ecosystem considerably. In the last altcoins season (altseason), FTM, SOL and AVAX were the DeFi tokens with the highest gains: 1,269%, 621% and 502%, respectively, as shown by the data the Blockchain Center.

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