• TVL (values ​​under custody) in the DeFi market increased by more than $15 billion in six weeks.
• Rising asset prices and new capital inflows combined to contribute to the rise.
• The value of several Solana-based protocols has increased by as much as 120%, and newly announced layer 2 platform Blast has received over $700 million in deposits.

The total amount of assets locked or staked in a decentralized finance (DeFi) protocol (Total Value Locked: TVL, assets under custody) increases rapidly in the value of the underlying asset, and the yield of the crypto assets (virtual currency) held by investors increases. As a result, on December 5th, it reached $50 billion (approximately 7.5 trillion yen, exchanged at 1 dollar = 150 yen) for the first time in six months.

That figure has increased by $15 billion since October 13, when the sector was at a multi-year low, according to data from DefiLlama.

The search for yield continued last week, with traders and investors undeterred by the fact that Blast, a newly announced Layer 2 project scheduled to come online in 2024, will not be able to withdraw its assets until at least March. He received more than $700 million (approximately 105 billion yen) in funds from his home.

Since October 13th, Ethereum (ETH), the main crypto asset used across the DeFi market, has risen 42%, outpacing the overall DeFi market, which has risen 41%. Notably, a significant portion of DeFi protocols offer yield on stablecoins pegged to traditional fiat currencies such as the dollar, euro, and pound.

Trading volume is also increasing. More than $5.4 billion (about 810 billion yen) was traded in a single day last month, the most since March.

The sector saw a boost earlier this year as a result of Ethereum’s move to proof-of-stake. This shift has fueled the popularity of the liquid staking market, led by Lido and RocketPool, which account for 45% of DeFi TVL.

Lido currently offers an annual yield of 3.7%, while Rocketpool offers 3.92%. Liquid staking is a form of derivative that allows investors to generate yield from staking Ethereum while receiving tokens that can be used elsewhere in the DeFi ecosystem.

The TVL of Solana-based protocols marginfi, Jito, and Marinade Finance has surged between 60% and 120% in the past 30 days as institutional interest in Solana continues to grow. Grayscale’s Solana Trust traded at an 869% premium last month, indicating strong demand from the institutional market.

Solana’s liquid staking protocol, Jito, offers a yield of 6.96%, a level that has led to $327 million in inflows since October 13th.

｜Translation: CoinDesk JAPAN
｜Edited by: Toshihiko Inoue
｜Image: DefiLlama
｜Original text: DeFi Market Rebounds to $50B as Speculators Hunt for Yield