VeChain DeFi TVL Plummets 97% from $35 Million Peak: What Happened?
Decentralized finance (DeFi) has faced significant headwinds recently, and VeChain is no exception. The total value locked (TVL) in VeChain's DeFi ecosystem has experienced a dramatic decline, falling 97% from its peak of $35 million. This substantial drop raises concerns about the platform's long-term viability and the overall health of the DeFi sector during this crypto bear market.
Leaving aside one recovery attempt, the TVL kept shrinking. At press time, the value of all the assets locked on VeChain was only worth $1.13 million, down 97%.
DeFi TVL: A Broader Perspective
While VeChain's decline is particularly steep, it's important to note that the broader DeFi landscape has also seen a contraction. According to data from DefiLlama, a leading DeFi TVL aggregator committed to providing accurate data without ads or sponsored content, DeFi’s TVL has decreased by more than 30% from its ATH of $137 billion noted in December 2025 to the current low of $94.65. The total value locked (TVL) in decentralized finance (DeFi) has plunged over 30% from its December peak, reflecting ongoing market uncertainties and macroeconomic factors. The total value locked (TVL) in decentralized finance (DeFi) has experienced a significant decline, falling over 30% since its peak in December 2025. Currently, the TVL stands at approximately
Decentralized finance has been battered over the past year as the crypto bear market bites deeper. As a result, DeFi TVL dumped to its lowest levels for almost two years.
Factors Contributing to the VeChain DeFi TVL Decline
Several factors likely contributed to the sharp decline in VeChain's DeFi TVL:
- Overall Market Conditions: The ongoing crypto bear market has significantly impacted investor sentiment and risk appetite, leading to a widespread decrease in DeFi activity.
- Limited VeChain DeFi Ecosystem: Compared to larger blockchains like Ethereum and Solana, VeChain's DeFi ecosystem is relatively small, making it more vulnerable to market fluctuations.
- Lack of Innovation: A perceived lack of innovative DeFi projects on VeChain may have driven users to explore other platforms with more exciting opportunities.
- Competition: The increasing competition within the DeFi space has made it challenging for smaller ecosystems like VeChain to attract and retain users.
Silver Linings and Future Outlook
Despite the current challenges, there are glimmers of hope for the DeFi sector. Total Value Locked (TVL) in DeFi has surged 160% from its low in 2025, now at $96.5 billion, indicating a potential recovery. Active loans in DeFi have rebounded to $13.3 billion, levels last seen in early 2025. Whether VeChain can capitalize on this potential upturn remains to be seen. Its future hinges on the development of compelling new DeFi applications and a renewed focus on attracting users and developers.
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