Despite ETH Hitting A New ATH, Ethereum’s DeFi Market Share Drops by 30% in the Past Year

The decentralized finance (DeFi) sector has been seeing some price action since last month, but it is extremely slow compared to the rest of the market.

At a $150.5 bln market cap, DeFi has hit the all-time high from mid-May. But DeFi blue-chips like Uniswap, YFI, and Aave are not leading these gains; the likes of Olympus and Spell that are termed DeFi 2.0 are the ones behind the latest interest in DeFi.

However, the total value locked (TVL) in the DeFi is seeing real growth and hitting new ATHs. Today, it reached yet another one at $244.56 billion, according to DeFi Llama.

The most popular layer 1 blockchain Ethereum also hit a new ATH with the value locked at $162.6 bln, up from $75 bln in late May. MakerDAO is currently the dominant project on Ethereum with $16.62 bln of assets.

But it’s not just Ethereum anymore; over the past year, the multi-chain universe has been expanding, and all of these other layer 1 blockchains together account for 34% of the overall DeFi TVL.

These other blockchains also cover Ethereum layer 2 blockchain Arbitrum, which has also amassed $1.96 bln.

Ethereum market share 1 year ago: 97%

Ethereum market share today: 67%

Ethereum market share a year from now: 30% ?

The multi-chain universe is only getting started. pic.twitter.com/WNGLV0dvuA

— Tascha (@RealNatashaChe) October 23, 2021

When it comes to other layer 1’s, Binance Smart Chain is at the top with $20.62 bln TVL, finally starting to grow this month after four months of sideways action. Just two weeks back, Binance announced a $1 billion incentive program to attract projects and developers back to BSC.

During the May mania, the TVL on BSC hit its peak at $32.6 bln as it offered a cheaper and faster alternative to Ethereum and is now trying to bring back that action.

Solana is another big competitor to Ethereum, which has the backing of FTX CEO and founder Sam Bankman Fried. At $13.53 bln, its TVL continues to hit new highs as it joins the NFT mania, and investors who missed the ETH train see SOL as their opportunity to have a high-performing asset in their long-term portfolio.

The latest stars of the layer 1 world are Terra and Avalanche with $9.97 bln and $8.2 bln in TVL respectively. With cheaper fees, liquidity programs, and burns, these two are currently ruling the layer 1 blockchain competition.

Their tokens LUNA and AVAX are also enjoying this traction, having hit their ATHs in about the last one month at $50 and $80, respectively.

Fantom (FTM) is another popular one at $4.91 bln, while Polygon (MATIC), which was extremely popular between April to July among the newcomers, has since lost its charm and is now at $4.64 bln has less than half of its TVL ATH.

Other notable mentions include Celo with $1 bln in assets and Harmony (ONE), whose TVL is $325 mln, growing since early July.