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ETH Shoot Up: Total Value of Ethereum Locked in DeFi Reaches a Record 3 Million

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A new record has been set by Ethereum locked in decentralized finance (DeFi) projects at 3 Million.

According to the tracker site, DeFi Pulse, the total value locked in DeFi reached a new milestone, hitting 3 million ETH for the first time ever.

An abbreviation of Decentralized Finance, DeFi refers to the digital assets, financial smart contracts, protocol, and decentralized applications built on blockchain, especially Ethereum.

“The goal of DeFi is to reconstruct the banking system for the whole world in this open, permissionless way,”

says Alex Pack, managing partner at Dragonfly Capital, a crypto fund.

“You only get that shot every 50 years.”

As can be seen, DeFi has seen significant growth in the past four months. Back in June, the total value locked (TVL) in DeFi reached an all-time high when Ether price hit its 2019 high at $335. Ethereum is currently about half of that value at just $174.

Despite this hard drop in ETH price, there is more Ether locked in DeFi than ever before.

MakerDao Dominates the DeFi Space

However, this is not the amount of Ethereum locked in DeFi, rather it is currently 2.2 million. This gap is due to the fact that this total value locked also involves Bitcoin.

Lightning Network, a payments network is one such project, only one among the top 20 projects that have (currently $6.6 million) Bitcoin locked in the system.

MakerDao, a decentralized credit platform on Ethereum blockchain, however, is the dominant player accounting for 52.74% share, having $274.8 million worth of Ether locked in the system.

Maker that has been using Ether as collateral in its “collateralized debt positions” is planning to roll out its multi-Collateral Dai system nest month that will let Maker users to take out Dai loans using other assets beyond Ether as collateral.

Additionally, this new MCD system will launch a Dai Savings Rate (DSR) that will provide interest earnings to users holding Dai in the smart contract. This will further bring new users to DeFi.

Among the top twenty projects, lending projects viz. MakerDao, Compound, InstaDapp, Dharma among others account for the most share. Other categories include Derivatives like Synthetix, Augur; DEXes like Uniswap, Bancor, and Kyber; Payments such as lightning Network, xDai; and Assets as in WBTC, and Set Protocol.

Recently, Morningstar Credit Rating also shared its interest in the world of Decentralized Finance (DeFi).

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