DeFi TVL Reaches One-Month High Amid Market Rebound
The total value locked in decentralized finance protocols has reached the highest in one month on the back of a rebound in the wider cryptocurrency market. For the first time since August 27, global DeFi TVL sits at $87.3 billion, per DefiLlama data.
Top Protocols Lead Surge
This past week saw all the top DeFi protocols register significant gain. Lido, the most valued protocol by TVL, surged in value 13% and jumped above the $25 billion mark. Aave was closely competing, with its performance almost similar, driving its TVL at $12.4 billion. EigenLayer made a strong third, with its TVL touching $12.2 billion.
Token Performance Suggests TVL Growth
The native tokens of these leading DeFi protocols also witnessed positive momentum. Lido DAO’s token was up 1.5% in the last 24 hours, changing hands at $1.15, while Aave’s token jumped up 7.8%, trading well above $170. This is indicative of growing confidence in these platforms.
Market Context: TVL Still Far From All-Time High
The recent gains have barely brought DeFi’s TVL close to its record high of nearly $188 billion last November 2021. Also, the total cryptocurrency market capitalization traced a similar trend and shifted upwards from $2.14 trillion to $2.31 trillion in the last week.
Interest Rate Cuts Spur Market Optimism
Most of the current market optimism has been pegged on the September 18 decision by the U.S. Federal Reserve to cut interest rates by 50 basis points. It added much-needed fodder to the crypto market, which had been in a protracted downturn
Conclusion
Although the recent surge in DeFi TVL was a good omen, the sector still had a very long way to go to reclaim lost glory. In the coming weeks, market participants will pay close attention to the performance of top protocols, including Lido and Aave, as a yardstick for the sustainability of the current recovery
