DeFi is gearing up for a major comeback, and Apollo Crypto’s latest report is sounding the alarm.
Apollo Crypto, an investment firm focused on digital assets, has released a new report that signals a potential second wave of growth for decentralized finance (DeFi). After the buzz of “DeFi Summer” in 2020 faded, major protocols like Maker, Uniswap, and Aave solidified their roles as industry leaders.
DeFi’s total value locked (TVL) currently sits at around $105 billion, and many believe a DeFi resurgence is just around the corner, with its strong fundamentals back in the spotlight.
The report highlights key macroeconomic drivers behind this potential upswing. The U.S. Federal Reserve’s recent interest rate cuts have made risk-on assets, including cryptocurrencies like Bitcoin and Ether, more appealing.
China’s central bank has also stepped in, reducing short-term interest rates and introducing supportive lending policies. Historically, Bitcoin’s performance has been linked to the growth of China’s central bank assets, which could further fuel optimism in DeFi.
Also Read: China Still Reigns in Bitcoin Mining Despite Ban
Another key factor driving DeFi forward is the improved infrastructure. Over the past few years, significant strides have been made to create more efficient blockchain networks, which has translated into faster transaction speeds and lower costs on layer-2 solutions.
This, combined with tokenized assets like Coinbase’s cbBTC, is expected to attract even more capital into DeFi.
Users can now easily convert Bitcoin into cbBTC when sending it across the Ethereum or Base networks, opening the door to alternative crypto assets with unprecedented ease.
On the protocol front, Aave continues to dominate decentralized lending, while Uniswap remains the top decentralized exchange by volume.
Maker has also maintained its influence, though its transition to the Sky ecosystem has sparked mixed reactions, particularly surrounding its new USDS stablecoin and its controversial “freeze” function.
With global markets shifting and blockchain infrastructure evolving, the DeFi space seems set for its next big leap.
