What is Total Value Locked – TVL?

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What is Total Value Locked?

Chances are, if you’re new to Decentralized Finance – DeFi, there’s a lot of terms and abbreviations you have never heard of before.

We recently explained to you what Non-fungible Tokens – NFT‘s are and how they are used. Now, we’d like to provide you an insight into what total value locked means and how this applies to DeFi.

TLDR; Total Value locked represents the total value of assets that are being staked into a (specific) DeFi pool, or better said how much liquidity is being provided into this specific liquidity pool by its users.

Why is Total Value Locked – TVL important?

Many view the Total Value Locked – TVL to be the best measure of adoption and growth. Though, we would argue that this is not necessarily the case as it heavily depends on the price of the underlying assets.

A better measure of growth would be to keep track of the total number of underlying staked within the liquidity pool, possibly even trading volume. This is because the past year the value of ETH and other assets have increased significantly, meaning the TVL went up in valuation even if there hasn’t been any growth or increased adoption.

Don’t get me wrong, TVL is still a very important factor as it shows how deep the liquidity pools really are. Deeper liquidity pool often attract larger traders and holders, and this could be seen as growth as well.

Where can I view Total Value Locked of all DeFi platforms?

There’s two main platforms you can use when keeping track of TVL on DeFi platforms.

The first platform is Defipulse. DeFi Pulse reflects the TVL on the Ethereum Network. The current TVL as of May 3rd, 9AM UTC, is $72.59B with almost half of the valuation locked in the top-4 DeFi platforms.

These are:

  1. MakerDAO $16B TVL
  2. Aave: $19B TVL
  3. Uniswap: $4,5B TVL
What is total value locked - Where can I view TVL of all DeFi platforms

Next to DeFi Pulse, where I keep track of the TVL on the BSC through Defistation.

What is total value locked - Where can I view TVL of all DeFi platforms2

DeFi Station shows that currently there’s $47.43B TVL on the Binance Smart Chain. Almost half of this is locked in the top 2 platforms Venus ($11B TVL) and PancakeSwap (10.46B TVL).

What’s interesting is that PancakeSwap currently holds more liquidity than Uniswap.

Interested in managing your DeFi opportunities?

Besides keeping track of TVL, I also keep track of DeFi opportunities, by using the OctoFi Loan Dashboard. This allows me to get a quick overview of the highest returning annual percentage yield – APY DeFi pools available.

If you want to participate in DeFi feel free to ask questions in our Free Telegram group! Or create an account to get started!