Over $36 Billion in DeFi Value Wiped Out — What Does It Mean for Ethereum?
The Decentralized Finance (DeFi) sector has skilled a pointy contraction since early October, as the entire worth locked (TVL) dropped over 21%.
Coupled with waning institutional curiosity, the decline has raised considerations about Ethereum’s (ETH) demand and its worth trajectory in November.
DeFi Protocols Register Double-Digit TVL Losses
Data from DeFiLlama confirmed that the entire DeFi TVL reached over $172 billion in early October. This marked its highest degree since late 2021. However, this multi-year peak was short-lived.
The newest figures point out that TVL has since fallen to round $136.26 billion in November, erasing greater than $36 billion in worth.
Major DeFi protocols endured vital losses over the previous month. Aave, Lido, EigenLayer, and Ethena reported TVL declines starting from 8% to 40%, highlighting the sector’s widespread slowdown.
One of the important thing drivers behind this dip is Ethereum’s worth correction. Following October’s market crash, ETH has continued to face challenges, with the price dropping close to $3,000 in early November.
Nevertheless, the weak point runs deeper. The ETH-denominated TVL has been steadily declining since April. This occurred at the same time as ETH prices were climbing. This divergence steered that ETH’s rally was pushed by sources apart from DeFi development.
Notably, two main components drove ETH demand: digital asset treasury funds (DATs) and exchange-traded funds (ETFs). In 2025, main institutional gamers elevated their publicity to ETH, whereas ETFs recorded strong inflows.
Yet, this accumulation has additionally slowed. According to figures from the Strategic ETH Reserve, mixed DAT and ETF holdings have fallen from 12.95 million ETH in October to 12.75 million ETH in November.
Furthermore, BeInCrypto reported last week that, after six consecutive days of outflows, ETH ETFs noticed $12.1 million in inflows on November 6. Nonetheless, this pattern reversed the next day. SoSoValue information highlighted $46.6 million in outflows on November 7.
Weakening demand throughout each retail and institutional fronts might probably go away Ethereum weak to additional draw back strain. Despite this, current macroeconomic catalysts have led to a modest restoration for ETH. At the time of writing, ETH was buying and selling at $3,609, representing a 6.6% improve over the previous day.
Analyst Ted Pillows has pointed to $3,700 as a key degree for Ethereum.
“ETH is approaching a key resistance degree now. If Ethereum closes a day by day candle above the $3,700 degree, it might rally in direction of the $4,000 degree,” Pillows posted.
The analyst famous that if Ethereum fails to interrupt above this degree, it might retrace towards the $3,400 assist space.
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