DeFi Total Value Locked (TVL) Hits Yearly High of $52 Billion

• TVL has increased from around $38B to a yearly high of $52B since the start of 2023.
• The current increase in TVL is due, in part, to the market’s recovery.

Total value locked (TVL) across DeFi protocols has hit $52 billion, an annual peak not seen since the days leading up to FTX’s demise in November 2022.

This comeback is significant because the industry has had a rocky past since FTX and other companies went under. The controversies surrounding these companies caused a lot of people to be wary of both centralized and decentralized finance protocols.

Market Recovery and Enhancements 

There has been some improvement in both areas in the last several months. In the case of DeFi specifically, TVL has increased from around $38 billion to a yearly high of $52 billion since the start of 2023, a 36% increase in monetary terms.

Still, asset price volatility may have a significant impact on the TVL metric’s worth. The recent upswing may be explained, in part, by the growing market prices of prominent cryptocurrencies and the consistent influx of new capital from investors.

The current increase in TVL is due, in part, to the market’s recovery and, more specifically, to enhancements and modifications made to various DeFi protocols.

For example, MakerDAO’s Dai stablecoin was backed by about $2.5 billion in RWA collateral, mostly in U.S. treasury bills, in 2023, contributing significantly to the real world assets (RWAs) sector inside DeFi.

This also helped it become less reliant on USDC and other centralized stablecoins. The locked value of MakerDAO has increased to over $8 billion, and the platform’s yearly revenue has also gone up.

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