Total Value Locked (TVL)
The total dollar value of assets deposited in a DeFi protocol or across the entire DeFi ecosystem.
What is TVL?
Total value locked (TVL) is the aggregate market value of all assets currently deposited in a DeFi protocol's smart contracts — including liquidity pool deposits, collateral in lending protocols, and staked tokens. TVL is the most widely cited metric for measuring the size and adoption of DeFi protocols and the ecosystem overall. A higher TVL suggests greater user trust, more liquidity, and more capital at work generating yield. TVL is tracked in real time on platforms like DefiLlama. However, TVL has limitations as a metric: it is denominated in USD, so it can fall not because users withdraw assets but simply because token prices decline. TVL also double-counts assets that are used across multiple protocols simultaneously (e.g., stETH deposited in Aave). Despite its limitations, TVL is a useful first-pass measure of protocol health and relative size within the DeFi ecosystem.
Example
At DeFi's peak in late 2021, total TVL across all protocols exceeded $180 billion. By mid-2022, as token prices collapsed, TVL fell to under $40 billion — largely due to asset price declines rather than mass withdrawals. Lido Finance consistently ranks among the top protocols by TVL due to its liquid staking product's popularity.
Source: DefiLlama — Total Value Locked