DeFi TVL Reaches $192 Billion in May, Despite Drop in Active Wallets

Total Value Locked (TVL) in Decentralized Finance (DeFi) applications soared by 17% in May, reaching $192 billion, a peak not seen since February 2022, according to a recent report from DappRadar. This growth is attributed mainly to the rise in Ethereum-based DeFi and increased trading activity.

 TVL Growth:
- Month-on-Month Increase: DeFi TVL grew by 17% in May, reaching $192 billion.
- Highest Since February 2022: This marks a significant milestone and a monthly high since early last year.

Factors Driving Growth:
- Ethereum Dominance: Ethereum accounts for 68% of DeFi's overall TVL, totalling $130 billion.
- Solana's Rise: Solana holds second place with a TVL of $10.9 billion, accounting for 5.7%, and saw a 14% month-on-month increase.
- Speculation: The popularity of Ethereum ETFs has led to short-term speculation, contributing to the increase in TVL.

Decline in Active Wallets

While TVL surged, the number of independent active wallets (UAW) in DeFi fell by 21% to 1.75 million. This decline indicates that while the value locked in DeFi platforms grew, user engagement in terms of active wallets dropped, suggesting a possible shift in user behaviour or market dynamics.