Bitcoin and Ethereum have been declining from their all-time highs for nearly a year now. For DeFi, the bear market has been even longer.
So, what is the current state of DeFi?
Here are 15 metrics we need to understand:
- Total Value Locked (TVL)
At the time of writing, $55.6 billion is locked in DeFi smart contracts.
This is a 69% drop from the all-time high of $182 billion on December 3, 2021.
Maker’s dominance of TVL is 13.98%, much lower than the 50% seen in the early days of DeFi summer in 2020.
- DeFi Token Prices (Year-to-Date)
The DeFi Pulse Index (DPI) tracks the performance of major decentralized finance assets in the market.
In USD terms, the DPI is down 67.8% this year, underperforming ETH by 5%.
Among the major DeFi tokens, CRV has seen the largest drop, at 85%.
While down significantly in USD terms, holders of ETH, LDO, UNI, SNX, CAKE, and LINK would have outperformed expectations if they had simply held onto their assets this year.
- Blockchain Development Activity
Data from GitHub Repositories shows that developers are still building.
Repositories are the places on Github where the code base is stored.
Based on tracking data from 87,116 Repositories and 98,960 developers, Ethereum and Solana are the most active, with Polygon in third place.
BNB Chain and Cosmos have stable development activity, but their development volume is much lower compared to the top three blockchains.
When it comes to code commits (tracking changes to the code base) for each chain, the situation looks even worse.
All blockchains have seen a significant decline in code changes, but Solana appears to be more active than Ethereum.
Finally, the data for new developers joining each chain is also not very optimistic.
Interestingly, over the past month, more developers have joined the Solana and Polygon ecosystems than Ethereum.
- Smart Money Holdings
Nansen’s Smart Money data refers to cryptocurrency entities that trade or invest in a way that is considered experienced, well-informed, or “in the know.”
Over the past 30 days, we have observed that Smart Money is moving funds into Compound, Aave, and wBTC. They have also accumulated MATIC, UNI, SRM, CHZ, KNC, and Shiba Inu’s BONE (anticipating Shiba’s L2 launch).
- Weekly DEX Trading Volume
Weekly DEX trading volumes have been declining but have remained at a level of $8 billion.
The top 5 DEXs by 7D trading volume are:
Uniswap – $5.4 billion
Pancakeswap – $1.3 billion (data from DefiLlama, not included in this Dune table)
Curve – $974.5 million
Dodo – $731 million
Balancer – $601 million
Sushiswap – $170 million
Most of Dodo’s trading volume comes from stablecoin pairs.
- DEX to CEX Spot Trading Volume
Centralized exchanges dominate their decentralized counterparts.
This ratio reached a historical high of ~25% in February 2022 but has since dropped to around 12%.
Considering the low cost of wash trading on CEXs, this ratio is not that bad!
- Stablecoin Yields
The days of high yields are long gone.
Most stablecoin lenders on Compound, Curve, Uniswap, or Aave are earning between 0.1% and 1.5%.
Taking into account the risk-reward ratio, Convex FRAX-USDC at 2.45% or FRAX-3CRV at 3.19% may be the best options.
However, only USDT depositors on Tron can achieve significant returns.
But please do your own research on USDT before depositing, as USDT is centrally issued, and the issuance/redemption policy is not transparent.
- Stablecoin Ratio by Chain
This ratio shows the value of stablecoins relative to the DeFi TVL deposited on each chain. Tron is a stablecoin blockchain.
- ETH Staking Volume
A total of 14.1 million ETH (11.7% of the total ETH supply) has been staked, valued at $19.4 billion.
The top 5 stakers by market share are:
Lido – 29.9%
Coinbase – 14.5%
Kraken – 8.2%
Binance – 6.5%
http://Staked.us – 2.9%
Liquid staking accounts for 33.4% of all ETH staking. Lido dominates, but RocketPool’s share has recently increased to 1.9
