DeFi on Ethereum remains one of the most extensive metrics to keep an eye on. As things stand, its TVL is en route to reach $70 billion again. Very little changes in terms of top projects, however, indicating there is much work to do.
Ethereum DeFi TVL Finally Recovers
A few weeks ago, it would appear that the total value locked for Ethereum DeFi would drop below $50 billion. Unfortunately, bearish crypto markets tend to suck all of the excitement out of the broader industry. Today, the landscape looks very different once again, primarily thanks to most markets recovering some lost value recently.
The recovery of the individual markets also does wonders for derived industries and projects. For decentralized finance, its overarching total value locked hinges on how the crypto markets perform at any given moment. A better market performance boosts the value of most DeFi assets and makes holders slightly more eager to put their holdings to work.
The current Ethereum Defi TVL is on the cusp of breaking $70 billion again. That value has not been seen for a month and a half. That may seem insignificant to onlookers, but it is a very big deal to an industry segment that remains relatively new and fickle. The TVL of Ethereum DeFi has never been stable but offers a steep upward curve mainly.
Since that curve broke down earlier this year, there have been some concerns over the decentralized finance industry. Many question whether it is even a viable industry segment anymore. The recent surge in TVL shows people are still invested in Ethereum DeFi regardless of the overall market conditions. A good sign, although it may not create more opportunities for smaller projects right away.
Where Is The TVL Going?
When the TVL of Ethereum DeFi decides to go up again, one must wonder why that is the case. The rising prices of crypto assets are one possible explanation, but they never tell the entire story. It seems more plausible that specific projects attract attention [again], getting investors on board willing to farm yield and take a few risks along the way.
Little has changed among the top Ethereum DeFi projects ranked by TVL, though. Aave, Curve Finance, and Compound are still in the top three, although Aave is ahead by billions of dollars. The only project noting any change in the past 24 hours is Yearn Finance, which lost nearly 14% in TVL. Some of the funds may end up in other projects.
The other project noting a significant TVL change is Enzyme Finance, which lost 42% in TVL. Again, it is a steep drop for a smaller project, as its total value is now below $95 million again. Speaking of smaller projects, there is some more competition in the lending and derivatives space. Most of these ventures have no significant TVl, though, indicting their struggle is far from over.