Introducing DeFi Lending Dashboards on AmberLens

After the successful launch of AmberLens, Amberdata’s institutional market intelligence platform, we are excited to expand our comprehensive metric coverage to DeFi Lending. These insightful DeFi metrics are split between stablecoins, protocols, and networks, which gives researchers, analysts, and traders a comprehensive overview of the ongoing and historical market trends.

DeFi Lending Overview

AmberLen’s DeFi Lending coverage includes visualizations across chains like Avalanche, Arbitrum, Ethereum, Optimism, and Polygon. In addition, these networks also include all lending activity across Aave v2, Aave v3, Compound v2, Compound v3, and MakerDAO.

TVL

Overall DeFi Lending Total Value Locked (TVL) in USD, with % change from the day prior

Overall, the DeFi Total Value Locked (TVL) has remained stable over the past three months, currently resting at ~$36.8 billion.

Overall DeFi Lending TVL (USD) by network

An overwhelming majority of this TVL is locked on Ethereum, with the Layer 1 network holding ~98% of TVL across all protocols and networks. Not only does the network represent the security layer for Layer 2’s, but it also represents the largest source of liquidity for them.

Overall DeFi Lending TVL (USD) by network and protocol

Aave v3 continues to lead the way for DeFi Lending protocols and holds over $14.6 billion on Ethereum, while Ethereum MakerDAO takes a second majority with ~$14.3 billion in locked funds. This perspective provides insights into various trends and signals. For example, seeing TVL build-up on Ethereum in March during the most recent memecoin run-up was a sign that new collateral was entering the DeFi space and likely that additional borrowing activity could take place – a bullish sign. In addition, TVL often increases as yields increase, maintaining the market dynamic of supply and demand.

Deposits and Withdraws

Overall DeFi Lending daily deposit and withdraw volume (USD) as well as net balance

Deposits and withdrawals are another important indicator of market activity with new deposits being locked (increasing overall TVL) and withdraws removing liquidity (decreasing overall TVL).

Overall DeFi Lending daily deposit volume (USD) and count

Overall DeFi Lending daily withdraw volume (USD) and count

Deposits and withdrawals, along with the count, can provide indications of large movements of funds, or possibly more critical signs such as a large outflow from many users. Monitoring these flows can indicate additional liquidity risks or support.

Borrow and Repays

Overall DeFi Lending daily borrow and repay volume (USD), as well as the net amount

Borrowing in DeFi Lending, as we hypothesized earlier, spiked in March during the memecoin run across Ethereum Layer 2’s and Solana. Borrowing is a great source of liquidity for individuals looking to leverage existing assets (earning yield and maintaining exposure) while putting new funds to use in trading or another use case (like buying an NFT for airdrops or recursive lending for even more yield).

Overall DeFi Lending total borrowed volume (USD) by network and protocol

Tracking closely with TVL, MakerDAO, and Aave v3 are also the largest dApps for borrowing funds on Ethereum.

Overall DeFi Lending total repaid volume (USD) by network and protocol

Meanwhile, we can track repayments and notice that MakerDAO had significant amounts of loans repaid during the March run, while the end of May run has similarly seen repayments on Polygon and MakerDAO.

Liquidations

Overall DeFi Lending total borrowed volume (USD) by network and protocol

Finally, liquidations occur when the value of collateral drops below a given threshold, most often triggered by large price swings or periods of high borrowing (given the collateral ratio maintained is near maximum thresholds). In April, price declines on collateral triggered several large positions creating liquidations of nearly $120 million in a single day.

Stablecoin Overview

TVL

Overall DeFi Lending stablecoin TVL (USD)

Stablecoins make up a significant portion of DeFi Lending and are one of the major areas of focus for traders and yield farmers given its wide applicability, speed, and stability. As such, stablecoins make up ~6.5% of DeFi TVL.

Percentage of overall DeFi Lending stablecoin TVL (USD) by token

Given USDT and USDC’s applicability and wide range of uses across DeFi Lending and DEXes, it may be no surprise that these tokens have the highest TVL, primarily found on Ethereum Aave v3.

Deposits and Withdraws

DeFi Lending stablecoin deposit and withdraws (USD) by network and protocol

Deposits and withdrawals can also be viewed across protocols and networks, by stablecoin. Recently, Ethereum’s Aave v3 USDC and USDT pools had the highest volume of deposits, outpacing MakerDAO’s USDC pool by a decent margin.

Borrow and Repays

Overall DeFi Lending stablecoin borrowed volume (USD)

A summary of the overall stablecoin borrowed volume can also provide researchers and analysts with insights into how stablecoins are being used in DeFi, with the trend showing that stablecoin borrowed volumes have been slightly declining but picking up again in the last few weeks.

Overall DeFi Lending stablecoin borrowed and repaid volume (USD)

Examining daily deposits and withdrawals, along with the net daily volume, the trend becomes more obvious with several days of net withdrawals balanced out with some spikes in net deposits.

Protocol Overview

Comparing each protocol, AmberLens shows a comparison overview as well as user activity metrics for MakerDAO, Aave v2, Aave v3, Compound v2, and Compound v3. Overview metrics are net across each network: Ethereum, Avalanche, Arbitrum, Optimism, and Polygon, while user activity metrics are separated by network.

Overview

TVL (USD) by protocol across each network

Aave’s importance as a DeFi Lending protocol has grown considerably since launch allowing for a huge number of tokens to be borrowed or lent at any given time. MakerDAO’s first-mover advantage has seen it keep its place among the top lending protocols and remains the second-largest protocol by TVL.

Total borrowed volume (USD) by protocol across each network

On borrowing activity, Aave v3 has had slightly higher borrow volumes than MakerDAO. This dynamic has been shifting dramatically in the last few weeks. In April, Aave v3 had ~$4.7 billion against MakerDAO’s $4.4 billion borrowed. Now, however, Aave v3 borrowed volumes grew to $6.47 billion signaling a wave of liquidity in the open market – usually a bullish sign.

User Activity

Percentage of distinct addresses making actions on DeFi Lending protocols distributed across protocols

Looking at user activity, it’s clear that Aave v3 has had significant user traction. As such it’s being used by over 91% of addresses interacting with DeFi Lending protocols. This is a huge signal for adoption, but also a great opportunity to tie together with deposit/withdrawal volumes on other networks as it appears these networks have far greater average deposits than Aave v3.

Percentage of distinct Aave v3 users across networks

Digging further into Aave v3, most user activity has occurred on Arbitrum. Although Aave v3 is the only DeFi Lending protocol covered here currently on Arbirtum, it’s a huge surprise given how the network has just over 4% of the TVL market share. It appears that users are heavily testing the L2.

By Network

Another perspective on AmberLens we highlight is a breakdown of many of these visualizations shown above separated by network, covering Ethereum, Avalanche, Arbitrum, Optimism, and Polygon.

Ethereum total TVL across DeFI Lending protocols

Taking Ethereum for example, we can see the TVL of DeFi Lending protocols has begun to slowly tick back upwards, having dropped slightly since March after a cooldown in the memecoin rally.

Number of distinct addresses making actions on Ethereum across protocols

Aave v3 has the highest number of daily active addresses, accounting for over 600 in a single day. Aave v2 is similarly significant seeing the second most active user base on Ethereum.

Daily net deposits as well as deposit and withdrawal volumes (in USD) on lending protocols on Ethereum

Daily net deposits on Ethereum have settled somewhat over the last few weeks as likely traders are finding yield elsewhere, such as Layer 2s, other protocols, or trading.

Total borrowed volume (USD) by protocol across Ethereum

Total borrowed volumes have now reached over $10 billion on Ethereum, with a majority of this volume being borrowed on MakerDAO and Aave v3.

Total cumulative liquidated volume (USD) by protocol across Ethereum

Finally, cumulative liquidation volumes by network are an interesting source of insights for risk and portfolio management. No surprise given most DeFi activity still occurs on Ethereum.