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DeFi sector roars back to life as traders position for bull market rally

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(Kitco News) - Decentralized finance (DeFi) was a hot sector early on during the last crypto bull cycle as the launch of platforms like Uniswap (UNI), the top decentralized exchange, offered a new level of access to both new and old crypto projects without the need to transact through a centralized exchange.

While the sector was hard-hit by the 2022-2023 crypto winter, it's beginning to show signs of life once again with the start of the next bull market cycle, and according to analysts, now is the time for traders to position themselves to maximize their upside potential.

Over the past 24 hours, multiple DeFi projects have recorded double-digit gains, a sign that crypto traders are starting to warm up to the DeFi sector – which means it could be due for a strong sector-wide rally.

Data provided by CoinMarketCap shows that five out of the top ten performing tokens over the past day are DeFi protocols, including dYdX (ethDYDX), PancakeSwap (CAKE), Joe (JOE), THORChain (RUNE), and Lido DAO.

Top 10 performers in the past 24-hours. Source: CoinMarketCap

On the 7-day chart, four out of the top ten performers are DeFi tokens as well, with 0x Protocol (ZRX) and (YFI) joining dYdX (ethDYDX) and THORChain (RUNE) as DeFi tokens recording double-digit gains.

Further evidence of the growing strength of the DeFi sector can be found in the total value locked across protocols, which has been rising over the past month.

Data provided by DeFi Llama shows that the TVL across DeFi has risen from $35.883 billion on Oct. 12 to $46.236 billion currently, an increase of $10.353 billion.

The top ten DeFi platforms have seen their TVL increase by more than 15% over the past 30 days, with six of those protocols recording increases in excess of 25%.

Top 10 DeFi protocols by TVL. Source: DeFi Llama

This trend was noted by Crypto Differ, who provided a list of the top 15 protocols in terms of TVL increases.

For those who are unfamiliar with DeFi, protocols with higher TVL tend to be more secure and trusted by the broader cryptocurrency ecosystem. Lady of Crypto has provided a good analysis on valuing DeFi protocols, which includes useful tools and websites to help curious investors gain more insights into this promising sector.

Bank of Canada publishes staff note on DeFi, highlights challenges and risks

With the trend of tokenization starting to pick up steam in bringing real-world assets on-chain, DeFi is primed to see an influx of value as investors move to bring their more traditional assets on the blockchain in order to tap into additional forms of collateral.

An example of the potential influx of value can be seen with the tokenization of U.S. Treasuries (T-Bills). According to data from, there is now $777.4 billion worth of tokenized Treasuries in circulation with an average yield to maturity of 5.24%.

As time progresses and protocols upgrade to include support for tokenized real-world assets, the value hosted on blockchain networks will skyrocket, and the tokens for the underlying platforms are likely to benefit.

As noted by MN Trading founder Michaël van de Poppe, “The bridge between DeFi and TradFi [is] the largest change for crypto, and potentially the biggest market mover for the coming years.”

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.