DeFi on the road to recovery after strong quarterly growth


Source: Adobe / Tierney

The Decentralized Finance (DeFi) industry is ‘on the road to recovery’ as DeFi-linked tokens increased their share of the total crypto market valuation from 4.7% last quarter to 5.8% this quarter, a new report from the crypto tracking site. CoinGecko noted.

According to the report, the total market capitalization of DeFi tokens has rebounded 91% since last quarter, from $ 67 billion to $ 128 billion currently. This is because user sentiment about DeFi has improved and other blockchains besides Ethereum (ETH) have gained more attention.

“The growing demand for DeFi is likely due to the rise of native DeFi products on other alternative channels like Avalanche, Solana and Terra,” the report says, specifically naming the first two as “the new stars” of DeFi.

As for other chains, the report states that Binance Smart Chain (BSC) maintained its 11% share of total locked-in value (TVL) in all chains, which is the same share the chain had in the quarter. latest. However, the figure is still well below BSC’s maximum share of 20% of TVL on all channels reached in May of this year.

“The attention seems to be on other channels, with notable projects starting on them,” the report said of the reason for the lack of growth at BSC.

Switching to Ethereum, which had a near monopoly on using DeFi, CoinGecko said the chain had managed to maintain its TVL dominance, even though TVL on all blockchains had increased significantly.

At the end of the third quarter, Ethereum’s TVL was $ 126.6 billion, or 76% of all channel TVL combined.

Zooming in on tokens in the various DeFi niches, CoinGecko found that decentralized exchanges (DEX), oracles, and lending platforms were the fastest growing groups, with each niche seeing the market capitalization of their tokens increase. from 28% to 40% quarter after quarter.

The market cap of DEX, for example, increased by nearly $ 10 billion to $ 32.8 billion at the end of the third quarter, the report adds.

Data snapshot taken October 1, 2021. Source: Crypto CoinGecko Report Q3 2021

The report also pointed out that regulators, such as the United States Securities Commission (SEC), have stepped up their scrutiny of centralized players in the crypto space, which may have contributed to the growing interest in decentralized alternatives.

” Notably, [crypto exchange] Coinbase was forced to cancel its crypto loan product (Lend) after a threat of legal action by the SEC, ”CoinGecko mentioned as an example of the increasingly difficult regulatory environment facing central exchanges and loan providers in the crypto space.

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Learn more:
– DeFi had a solid year 2021, driven by new trends and new paradigms
– Multi-chain future brings several competitors to Bitcoin and Ethereum – Analysts

– How Solana and Binance Smart Chain could take Ethereum’s initiative
– Binance to inject $ 1 billion into channel, targets billion users

– $ 0.5 million paid when an Ethereum transaction fails
– DeversiFi explains what caused the $ 23 million transaction fee on Ethereum



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