The USD value of cryptocurrency liquidity in the decentralized financial sector (DeFi) was $ 35.8 billion. What is interesting is that the growth is due to lesser-known DeFi protocols rather than more established projects
Total Value Locked (TVL) in DeFi
Total Value Locked measures the total value of the tokens that are locked within the DeFi sector. The higher the locked value in a DeFi project, the better.
The TVL has skyrocketed since the DeFi sector emerged in August 2017. At the end of 2018, TVL was worth around $ 300 million in this sector, while the value hit $ 800 million just a year later. However, the end of 2020 was a record period as the year ended with around $ 15 billion in decentralized finance projects.
The rate of TVL growth over time has shocked analysts and regular watchers alike, leading some to believe that DeFi is in a bubble ready to pop. However, Justin Banon, CEO of Boston Protocol, believes the disruption of centralized funding is the catalyst that will continue to fuel DeFi growth.
Today’s valuation of $ 35.8 billion represents a 132% increase in the five weeks since the start of the new year.
Currently, the top three logs are Maker, Aave, and Compound with total locked-in values of $ 6.03 billion, $ 5.66 billion and $ 4.15 billion, respectively. It is interesting that all three projects are loan logs.
Decentralized exchanges form the next largest category. In this area, Curve Finance, Uniswap, and SushiSwap are at the top, with $ 3.85 billion, $ 3.67 billion and $ 3.13 billion in locks, respectively.
The total market capitalization for cryptocurrencies hit a new all-time high of a whopping $ 1.3 trillion. A good part of that growth came from the performance of DeFi tokens, as well as Ethereum as the platform they were built on over the past week.