The impact of Terra’s demise continues to shine a light on the fragility surrounding the decentralized finance (DeFi) ecosystem. Things have changed drastically after Tera’s result, as the Total Value Locked (TVL) in DeFi fell from $231 billion to today’s $112.29 billion, a decrease of 51.38% in 42 days.
DeFi TVL down more than 50% since April 3rd, Terra Implosion hits DeFi economy the most
The total value locked in Defi today stands at $112.29 billion, up from $100 billion. While TVL has been slipping since reaching an almost all-time high on April 3rd, last week’s Terra chaos took away most of the TVL held in the decentralized finance protocol.
In addition to the $231 billion TVL commanded 42 days ago on April 3, the Terra blockchain held $30.45 billion, or 13.15% of the total $231 billion at the time. Terra held the second largest TVL in Diffie and today, Terra is ranked 14th with only $500.38 million.
Of Sunday’s $112.29 billion, Ethereum dominated TVL in DeFi, accounting for 63.63% of the total in DeFi, or $71.09 billion. The second largest TVL in DeFi is tied to Binance Smart Chain (BSC), which accounts for $112.29 billion or 7.71% of the $8.62 billion on BSC.
Another significant change that occurred this week was the collapse of Curve’s DeFi dominance, as MakerDAO is now the largest DeFi protocol in terms of TVL size. MakerDAO dominates 9.40% with its TVL of $10.56 billion and Curve now holds $8.76 billion.
The current TVL of the curve is very different from that of April 3, when it stood at $21.17 billion, about 42 days ago. Today’s top 28 DeFi protocols have seen significant TVL reductions during the past seven days. Whereas MakerDAO is down 13.73% this week and the curve is down 49.18% last week as well. This week Lido is down 46.37% and DeFi application Away is down by 21.94%.
After being the third-largest DeFi application for TVL a week ago, Anchor dropped 97.76 per cent to the 58th position this week. Statistics show that Anchor has a total value of $309.78 million in lending protocols today.
As far as the TVL size is concerned, 17 DeFi protocols have at least $1 billion or more. There is still $419 billion in smart contract protocol tokens today, with Ethereum leading the pack. Terra is now ranked 18th in terms of smart contract platform token market capitalization.
While Terra issues pervaded the entire crypto-economy, the massacre affected decentralized finance the most. Not only was faith shaken at heart, but in less than a week, over $100 billion was withdrawn from DeFi.
Trust is likely to take some time to be restored, and the $100 billion lost is added back to the DeFi ecosystem. Out of all the DeFi chains, Ethereum has gained the most as dominance has increased significantly since the past week. However, Ethereum is still feeling the impact, as the chain is down by 31.53% over the past seven days.
What do you think about Diffie’s situation today? What do you think about the trust that has been lost and $100 billion has been taken away from the DeFi space? Let us know what you think about this topic in the comment section below.
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