DeFi markets show unprecedented growth in 2021

DeFi markets have doubled in value in 2 months

Growth driven by DeFi lending protocols, where Maker dominates

Since their inception, DEXs have seen an increase in volumes in 2021

In the midst of the crypto bull run , the decentralized finance ( DeFi ) markets have more than doubled in total blocked value (TVL) since the start of 2021.

Decentralized finance markets are showing 143% growth so far in 2021. This equates to $ 37.69 billion by combining lending protocols, decentralized exchanges, derivatives, payments and payment protocols. active.

Growth dominated by loan protocols and DEXs

Among these different sectors, the Bitcoin Billionaire scam loan protocol has achieved a dominant position of 16.47% in the market according to data from DeFi Pulse . Maker DAO is currently leading the pack with $ 6.21 billion in total value blocked.

The other two most important loan protocols, Aave and Compound , have a total value of almost $ 10 billion. Lending protocols show 133% more locked-in value over their values ​​since January 1, 2021.

Decentralized Exchanges ( DEX ) are the second most important type of DeFi platform after the aforementioned loan protocols.

As Bloqport Insights points out in a tweet , DEXs have recorded a volume of over $ 120 billion to date in 2021. That’s more than the volumes these exchanges have processed in all of their combined years before 2021.

Monthly DEX Growth Graph by Dune Analytics

At the current rate, DEX volumes are expected to reach $ 67 billion in value by the end of the month. This would surpass the previous monthly record of $ 63 billion in January 2021.

The dominant DEX is Curve Finance, which owns over 30% of the total blocked value in all DEXs. Uniswap and SushiSwap, whose competitive saga made headlines last September, are both honorable mentions.

The influence of flagship crypto assets

DeFi is primarily tied to Ethereum as an asset, as the majority of protocols and dApps are built on the Ethereum blockchain. However, the market also seems to react to price changes of Bitcoin .

This influence was evident in the last price crash in the cryptocurrency markets on February 22 – often referred to as “Bloody Monday”. Much like Bitcoin and almost all other altcoins, the DeFi market has also seen a decline in value. The total value stranded in the market rose from an all-time high of nearly $ 43 billion on February 22 to $ 36.16 billion on February 24.

Although the growth of the DeFi market in 2021 appears to be extremely rapid, there are signs that there is a possibility of sustainable growth. Institutional asset manager Grayscale Investments has also added DeFi-related assets such as Aave, Cosmos and Polkadot to its portfolio . Brave even announced the launch of its in-browser DeFi wallet , with access to a DEX on which users can trade their assets.