DeFi Sets New Record as Investors Lock $15 Billion in Assets

While the Bitcoin price rise is gaining all the attention from investors, DeFi is quietly making big moves. The market set new records as over $15 billion in investor equity is locked up on DeFi contracts now.

Slower growth for DeFi

Since exploding in the summer of 2020, the DeFi market has been experiencing slower growth. However, the interest in DeFi hasn’t subsided. According to DeFi Pulse, over $15 billion are locked up in DeFi contracts today. DeFi or Decentralized Finance is a new type of non-custodial financial products built mostly on Ethereum. These products are typically used in lending and borrowing services. The total value locked up in these contracts define the total amount of money staked by users in the DeFi smart contracts.

The industry grew at a rapid rate in 2020 and billions of dollars were poured into DeFi projects. The biggest projects in the industry are Maker, Aave and Compound. Maker has $3 billion in value locked up. This helps Maker dominate the market with 20% share. The price of its token today was $612.46. Aave and Compound have $2.08 billion and $2.07 billion each and their tokens are worth $86.50 and $141.98 respectively.

Industry stays strong

Interest in DeFi continues to grow even as skeptics believe that the industry is only a bubble which is showing signs of a slowdown. However, the industry has grown significantly in the past year. At the same time last year, the total value locked up in DeFi protocols was $689 million, marking a 2,077% increase in just one year. At its peak, investors were adding a billion dollars every week into DeFi protocols.

Interest in the projects is increasing because of the good returns made by investors. Yield farming is helping investors make more money. The most important value generator for users is that DeFi could help them idle crypto earn them a fixed income.