Aggregators, active addresses, and consistent fund raising indicate that "DeFi winter" is not yet here.
The amount of money invested in smart contracts is tracked by the crypto market's aggregate total value locked (TVL), which dropped from $160 billion in mid-April to $70 billion at present—the lowest level since March 2021. Despite the fact that this 66% decline is unsettling, a lot of evidence points to the decentralised finance (DeFi) sector's resiliency.
The drawback of adopting TVL as a general metric is the lack of information that is not displayed. The indicator does not account for factors like as the volume of DeFi transactions, the expansion of layer-2 scaling solutions, or venture capital inflows into the ecosystem.
Compared to the prior quarter, the DeFi 2Q transaction count closed down by 15%, according to statistics from DappRadar's July 29 Crypto adoption report. This figure, which is supported by a 12% decrease in the number of unique active wallets over the same period, is significantly less worrying than the catastrophic TVL reduction.
Layer-2 is the route to long-term DeFi growth.
With the use of layer-2 to group transaction verifications off-chain, optimism is an Ethereum scalability solution that lowers the processing and transaction costs for decentralised apps on the network.
Venture capital inflows provide more evidence for DeFi's robustness. Multicoin Capital, a cryptocurrency-focused company, unveiled a $430 million fund on July 12. The 2017-founded investment management company wants to concentrate on creating Web3 infrastructure, DeFi applications, and autonomous business models.
The successful $450 million capital increase by Variant was announced on July 28. It was used, among other things, to support "financial empowerment through DeFi." NFTs, stablecoins, lending optimizers, DEX aggregators, and "solutions that bridge the legacy financial system with DeFi" are among the strategies that are financialized and made more productive.
Levin is convinced that scaling solutions will advance decentralised financial applications beyond what was previously feasible during the so-called "DeFi Summer 2.0" in the third quarter of 2021 as a result of these big capital raises. During that time, the typical Ethereum network transaction price exceeded $25, making it nearly impossible for the applications to acquire traction.
Oneinch Network and Metamask Swap stand out.
According to report, the quantity of active addresses running DeFi applications has remained largely constant over the last 30 days.
Active addresses have decreased on average by 2%, according to the data, although four out of the top five applications showed increase. Furthermore, DEX aggregators 1inch Network and MetaMask reported significant user growth, dispelling worries about a "DeFi winter."
In summary, since its previous peak in late 2021, the decentralised finance sector has continued to expand in terms of active addresses, venture capital investments, and novel solutions that enable cheaper and faster processing.
