Most annual reports for 2024 highlight that Crypto exploits slowed, with DeFi accounting for much less than previous year's exploit incidents.
Whilst crypto, in the year 2024, may have seemed mostly focused on memecoins and prediction markets and AI agents making late entry to close off leading narratives throughout the year, the decentralized finance(DeFi) segment of the market hasn't been asleep.
There's been some admirable growth and developments within the industry that I'm tempted to believe we're very close to taking back control of our finances through decentralized solutions that are secure, fraud-proof and void of central points of failures.
Since 2020, the year DeFi gained broad traction, we've watched industry voices call “bull” for the idea of DeFi protocols and solutions changing how people manage finance, effectively categorizing the sector under development segments they considered their products just marketing scams to no positive ends.
Fuck your utility; they said
In such a short time of their existence, I've come to realize that they are no greater fools than memecoin enthusiasts who essentially bait people into investing in rugpulls.
2024 has been a crazy year, second to the wars, watching the cryptocurrency ecosystem entertain these flawed narratives was very difficult. We adopted trends built on launching a coin, pulling liquidity when certain volumes are attained, then migrating the coin into what we named “community takeover memes” to which will eventually also be rugpulled and the spin continues.
Halfway into the vast flow of liquidity into these obvious scams, opinions for 2025 bull run began spreading with degenerates preaching that “utility coins” were dog-shits and the actual shitcoins will outperform everything else.
Well, how's that working out?
The problem with such sentiments is that it ignores that memecoin traders lost the most money(quickly) throughout the year and very few came out millionaires — the side of the industry heavily covered by the media.
DeFi is due for a Comeback
Looking at 2023 report on Crypto exploits by immunefi(pdf) a total of $1.802 billion was lost by crypto investors and DeFi exploits accounted for a staggering 77.3% of the total amount.
What's interesting is that this number was much higher in 2022, with over $3.18 billion stolen from DeFi in said year, making 2023’s exploit sum a 56.1% decrease.
Moving on, 2024 saw further decline in total exploits and DeFi’s share of the exploit also dropped significantly. In the 2024 report(pdf) DeFi suffered a loss of only $769 million, representing a 44.8% decrease compared to 2023.
Generally, one would be tempted to think that the slowed exploits comes as a result of less DeFi related developments but 2024 was a big year for DeFi with the spotlighting and adoption of Restaking and Liquid Staking solutions, in addition to the launch of differing decentralized options markets and more recently, a new decentralized stablecoin protocol by USUAL
If we want to judge it by data, Thorchain has more than doubled its total value locked(TVL) since Dec 2023, now sitting at $399 million.
The broader DeFi sector was sitting at $53 billion TVL as of Dec 2023, but is now at approximately $129 billion, about 2.45x growth.
If TVL is not impressive given that it can be misleading when crypto asset prices increase, let's look at 2024 volumes which went parabolic as DeFi recorded a staggering $2.66 trillion trade volumes with November and December being its biggest month pulling $374 billion and $436 billion, respectively.
Since 2020, DeFi trades ratio against centralized exchanges have gone from just 0.13% as of May to 11.05% in December 2024.
This is an impressive growth, considering not just the timeframe of just 4 years but also the low DeFi education and security flaws over said time.
I guess utility wins after all, and it's only a matter of time before everything comes on-chain. Recent adoption of decentralized perpetual contracts trading platforms is particularly one development I've been glad to witness.
DeFi remains the best bet, long-term, as everything crypto literally revolves around having a non-centralized finance layer otherwise, what even is crypto solving then?
Posted Using InLeo Alpha
Really hoping thorchain can combine with kujira and make a big hit in the first quarter. It is a shame that they have not had the traction they could have/should have had yet.
Some newcomer is going to make a hit in DeFi even if the old tried and trues have only modest gains.