TVL crashes 40% after DeFi throughput peaked

Massive outflows from the decentralized finance (DeFi) sector were observed. Locked assets have declined rapidly in many DeFi projects, notably protocols such as Yearn.finance (YFI), Aave (AAVE), and Uniswap (UNI).

Even protocols such as Maker (MKR) and Compound (COMP), which recently achieved the highest values ​​of all time, have their share of the declining market value trend.

Not only DeFi protocols in the Ethereum network, but also leading names such as PancakeSwap (CAKE) on Binance Smart Chain (BSC) have declined.

MKR / USDT, COMP / USDT, UNI / USDT, AAVE / USDT, YFI / USDT and CAKE / USDT parity comparison. Source: TradingView

When we consider the ecosystem in general instead of evaluating decentralized protocols alone, the picture of decline becomes clearer.

Statistics shared by on-chain data source DeFi Llama show that as of May 10, the total amount of locked assets in the decentralized finance ecosystem increased to $ 164.2 billion.

In a short period of 12 days, the amount of locked assets decreased by 41 percent and was calculated as 95.6 billion dollars on May 23.

Total amount of assets locked in the decentralized financial ecosystem. Source: DeFi Llama

The total asset value locked to the protocols is derived from the combination of local token prices outside of the market’s leading currencies such as Bitcoin (BTC) and Ether (ETH). In other words, the decline in the overall market leads to a decrease in the total locked amount and traders withdraw their funds to reduce the loss.

According to the data shared by Dune Analytics, the transaction volume that occurred on May 19 reached a record level. On the subject on May 20 tweet The sending data source announced that 10 percent of the total decentralized exchange transaction volume in 2020 was achieved.

Daily decentralized exchange trading volume. Source: Dune Analytics

According to CoinMarketCap data, the total market value of cryptocurrencies other than Bitcoin fell to $ 680 billion on May 23, after seeing $ 1,474 trillion on May 12. The regression in approximately 11 days was calculated as 53%.

Total cryptocurrency market cap excluding Bitcoin. Source: CoinMarketCap

At the time of this article, the total market value of the non-Bitcoin cryptocurrency ecosystem was around $ 824 billion.

The opinions and comments expressed here belong only to the author. It may not reflect the views of Cointelegraph.com. Every investment and trading transaction involves risk. When making your decision, you should do your own research.

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