Originally published on: December 09, 2024
The decentralized finance (DeFi) ecosystem is experiencing a surge in Total Value Locked (TVL), nearing highs not seen since 2021. According to data from DefiLlama, the adoption of liquid restaking tokens (LRTs) and the growth of Bitcoin-native Layer 2 networks (L2s) are driving this upward trend. The recent increase in cryptocurrency prices due to the 2024 bull market has also contributed to the rise in TVL.
As of Dec. 9, the aggregate DeFi TVL has surpassed $134 billion, marking a nearly 150% increase year-to-date, although still below the 2021 high of $170 billion. EigenLayer, the leading restaking protocol that launched in 2023, has bootstrapped over $17 billion in TVL, leading to the emergence of an ecosystem of LRT protocols like Ether.Fi, Renzo, and Kelp.
Ether.Fi alone boasts a TVL of over $9 billion, with a total LRT TVL exceeding $16 billion across various restaking tokens. Lido, a prominent Ether liquid staking token (LST) protocol, has drawn nearly $40 billion in staked assets, with approximately 10% being restaked on EigenLayer.
On the Bitcoin front, liquid staking tokens (LSTs) have amassed over $2.5 billion in TVL, with tokens representing claims on staked Bitcoin in L2 networks like CoreChain and Babylon. Lombard and Solv lead the pack in Bitcoin LSTs, with TVLs of around $1.15 billion and $1 billion, respectively.
The future looks promising for both restaking and cryptocurrency adoption, with institutions expected to explore risk-adjusted strategies to maximize staking rewards. Stay tuned for more exciting developments in the DeFi space as TVL continues to soar.