As the 2024 bull market extends, fund inflows are reaching new records. Stable Ethereum (ETH) prices and new Bitcoin (BTC) price records are already reflected in DeFi.
More value is getting locked through Bitcoin and Ethereum, as their value grows at the end of the year. The effect of the bull market led to an overall recovery of DeFi in the past month. Funds are flowing into BTC staking protocols and ETH-based DeFi.
Inflows were even more noticeable in liquid restaking, one of the growth sectors for the whole year. Additionally, Hyperliquid’s rise to prominence turned it into the biggest hub for value locked after BTC and ETH.
Value inflows favored BTC, ETH, and the Hyperliquid DEX. | Source: Lookonchain
Based on the change of total value locked, Hyperliquid accelerated its inflows. The value locked in BTC and ETH is growing as a result of the price rally, while also increasing the value of collaterals.
Fund inflows into those top projects range from user deposits to DeFi and ETF buying. Fund inflows may differ for the various ecosystems, but the overall trend remains positive. The biggest outflow of funds is from TRON, while smaller inflows continue for the most active L1 and L2 chains with developed DeFi and Web3 apps.
In the past week, BTC staking expanded after the Cap-3 event by Babylon Labs. The event wraps up on December 16, after drawing new non-custodial staking for 1,000 blocks. The event drew in an additional 59,983 BTC, valued at $5.38B. Those inflows will be counted in the coming weeks, reflecting the vertical expansion of TVL for Bitcoin’s network. The total value of locked BTC is now $6.92B, at prices above $104,000 per coin. Most of the value is locked with Babylon Labs, which carries $5.63B total liquidity.
Hyperliquid grows TVL with new trading offers
Hyperliquid is in the process of growing its decentralized futures trading platform. The DEX is adding new trading options, starting out with low leverage.
Hyperliquid is also constantly expanding its open interest, drawing in inflows of stablecoins. The exchange does not carry spot markets, and only offers derivative pairs.
Hyperliquid reached a new all-time high in open interest of >$4.3B. pic.twitter.com/8YUwBEEWEU
— Hyperliquid (@HyperliquidX) December 16, 2024
According to other metrics, Hyperliquid locks in $3.19B with vertical growth since its launch in December. The rise of the HYPE token and the potential for high-speed trading is boosting the positions of Hyperliquid as one of the actively growing protocols.
As a result of the growth, the native HYPE token has been on an expansion track. HYPE trades at $26.50, with no drawdowns since the token generation event. HYPE holders are also not selling, unlike early Magic Eden (ME) recipients.
Ethereum liquid staking and restaking boost DeFi
The other source of liquidity and locked ETH are DeFi apps with requisite collaterals. Liquid staking now carries a total of $70.69B, producing $7.68M in daily fees. LidoDAO is still the leader with more than $39B in value locked.
The other big source of inflows are liquid restaking protocols, which build another layer of liquidity. Over the course of 2024, liquid restaking expanded by more than 6,000%, with total value locked increasing above $17B.
EtherFi is the leader, holding more than $9.37B, followed by KelpDAO. The sector started out with just $284M in January. Overall, the DeFi sector now locks in more than $140B, a level not seen since April 2022. DeFi value crashed since 2022, while protocols had to rebuild and liquidity flowed to new apps.
One of the growth apps in 2022 was Aave (AAVE), which now holds upward of $22B in various assets. The creation of $196.8B worth of stablecoins is also adding to the available liquidity for pools, staking and lending.
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