The Problem with TVL, DeFi's Favorite Metric
The crypto world loves to talk TVL. Short for “total value locked,” the term became ubiquitous during the DeFi boom of the last two years, and represents the total financial value locked up in smart contracts.
The reason TVL is on everyone’s lips is because it shows just how fast DeFi has grown. In early 2020, total TVL for Ethereum DeFi stood at barely $1 billion—while today the estimate is north of $80 billion, according to DeFi Pulse. This means there’s a staggering amount of liquidity in DeF