- The DeFi market has just hit a new all-time high, exceeding $4 billion in TVL.
- The leading project remains Maker, which currently holds $1.23 billion.
- DeFi has doubled its TVL in July 2020 alone, showing just how quickly the sector is developing.
The DeFi sector has been around for years, but it only started attracting major attention in 2020. As a new global trend, its growth was quite fast, and the sector has already breached several milestones in recent months.
Now, it even managed to hit a new all-time high, after breaching $4 billion in total value locked (TVL) for the first time in its history. Not only that, but it doubled its TVL in less than a month. The information about DeFi’s new milestone is quite clearly visible on DefiPulse.com.
DeFi crosses $4b, with Maker in the lead
As some may know, DeFi (decentralized finance) refers to the use of blockchain technology, as well as its various products. Those may include smart contracts, digital assets, and alike.
These products are used for the purposes of providing financial services, such as lending, staking, and more. The goal is to offer the same kinds of financial services available in traditional finance, only without the need for a centralized authority that would manage them and charge large fees.
This sector has been growing rapidly in recent months, and the fact that it just surpassed $4 billion in locked cryptocurrencies is proof enough that people consider such services to be superior to those provided by banks.
In essence, this means that $4 billion in crypto is now locked inside various protocols, dApps, and smart contracts. Almost 30% ($1.23 billion) is locked within MakerDAO’s DAI stablecoin project, while the second-largest project, Compound, only holds $708 million.
Since the DeFi sector is still largely only available on Ethereum, its growth has helped the world’s largest altcoin with its own growth and recovery. It is not the only thing that has led people to Ethereum, and that allowed ETH to rally — the announcement of the final Ethereum 2.0 testnet also brought many new opportunity-seekers.