Decentralized finance (DeFi) TVL nearly doubled in the first three months of 2024 compared to the previous quarter, driven in part by Ethereum liquid restaking initiatives, according to recent research.
DeFi TVL surged from a Q4 2023 low of $36 billion to peak at almost $97 billion in Q1 2024, marking an 81% increase since the beginning of the year to reach a two-year high of $98 billion.
The growth in TVL was attributed to asset price appreciation and liquid restaking, with Ethereum’s TVL increasing by nearly 71%.
Liquid staking, restaking, and liquid restaking were identified as key catalysts for DeFi’s explosive growth, with liquid staking TVL reaching an all-time high of $63 billion, primarily led by Ethereum liquid staking protocol Lido.
Liquid restaking protocols like EigenLayer experienced significant popularity and usage, with EigenLayer TVL surging by 990% in the first three months of 2024 to end the quarter at $12 billion. EigenLayer allows ETH to be staked multiple times for additional yields.
There was a substantial 291% quarter-on-quarter rise in user activity, signaling hopes of a second ‘DeFi Summer’ despite regulatory efforts from the SEC.
Following the recent crypto market retreat, DeFi TVL has declined by 11% to $86.6 billion at the time of writing, indicating some volatility in the market.
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