The total market capitalization of all decentralized finance (DeFi) tokens has exceeded $45 billion today, according to crypto metrics platform CoinGecko.
The total market cap of DeFi tokens. Image: CoinGecko
Market capitalization is an assetâs current price multiplied by its total supplyâa metric that lets you compare multiple coins that have wildly varying supplies. In other words, this means that all DeFi-specific tokens combined are worth over $45.5 billion at press time.
âDeFi total market cap. 2020 was at $2 billion. 2021 now at $43 billion,â CoinGecko tweeted yesterday.
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DeFi total market cap 2020 was at $2 billion 2021 now at $43 billion
Evidently, the DeFi ecosystem grew by another $2 billion in terms of its market cap since thenâin just one day. During the same period, the total daily trading volume of DeFi tokens exceeded $12 billion.
Over the past week, for example, many DeFi tokens have seen significant price surges, thus contributing to the total market capâs growth. Out of the top 10 assets, Uniswap (UNI) and AAVE showed the most notable results, both increasing in price by roughly 40% in the last seven days, according to CoinGecko. Other coins rose even faster, with DODO and Alpha Finance each doubling in the last seven days.
The top five DeFi tokens. Image: CoinGecko
As Decrypt reported, Ethereumâs decentralized finance sector exploded in mid-2020, surging from $700 million locked in DeFi smart contracts at the beginning of the year to $15 billion on December 31. This is the amount of cryptocurrency thatâs used with the various DeFi protocols, such as for lending or borrowing. And it looks like DeFiâs growth is continuing to skyrocket in 2021.
During January alone, the total value locked on DeFi platforms has already increased by $11 billion, reaching over $26.2 billion today, according to DeFi Pulse.
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The total value locked in DeFi. Image: DeFi Pulse
However, CoinGeckoâs data shows that DeFi tokensâ combined price currently amounts to only a fraction (4.6% to be precise) of the total market cap for all cryptocurrenciesâwhich hovers around $1 trillion.
However, considering DeFiâs somewhat chaotic nature (and the tendency to get hacked regularly), some users are skeptical toward the ecosystemâbut even they acknowledge that there is still a lot of room for this âbubbleâ to grow.
âDefi dominance⌠Look how early we are⌠4.5% I refuse to believe that this is anywhere close to the top of the bubble,â wrote Twitter user CryptoMessiah.
Considering the pace at which the DeFi market is growing, thatâs still an impressive bubble.
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