Cryptocurrency

DeFi TVL drops 16% however stablecoin market stays agency


The full worth locked (TVL) in DeFi protocols noticed important volatility up to now week, dropping from $140.95 billion on Dec. 17 to $117.76 billion on Dec. 20 earlier than partially recovering to $122.06 billion by Dec.26.

defi tvl
Graph displaying the full worth locked (TVL) throughout all DeFi protocols from Sep. 1 to Dec. 26, 2024 (Supply: DeFi Llama)

In the meantime, the stablecoin market cap remained remarkably steady, hovering round $240 billion with minimal fluctuation since Dec. 17.

The divergence between TVL and stablecoin market cap is important as a result of it demonstrates that the TVL decline was primarily pushed by the depreciation in crypto asset costs fairly than a elementary shift in consumer conduct or capital flight from DeFi protocols. Had customers been actively withdrawing capital from DeFi, we might possible have seen corresponding actions within the stablecoin market cap.

The steadiness within the stablecoin market cap means that customers maintained their positions fairly than changing to fiat, which reveals merchants are nonetheless locked into the broader DeFi market regardless of value volatility. This additionally signifies that merchants see value drops as momentary market actions fairly than systemic dangers. The slight restoration in TVL from Dec. 20 to 26 (+3.6%), whereas crypto costs remained suppressed, additional helps this interpretation, suggesting some opportunistic capital deployment at decrease valuations.

Disclaimer: Our writers’ opinions are solely their very own and don’t mirror the opinion of CryptoSlate. Not one of the info you learn on CryptoSlate needs to be taken as funding recommendation, nor does CryptoSlate endorse any challenge which may be talked about or linked to on this article. Shopping for and buying and selling cryptocurrencies needs to be thought of a high-risk exercise. Please do your personal due diligence earlier than taking any motion associated to content material inside this text. Lastly, CryptoSlate takes no accountability must you lose cash buying and selling cryptocurrencies.



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Andjela Radmilac
Andjela Radmilac

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