Market reset sees DeFi borrowing roar back 959% by 2024 amid CeFi decline
The post Market reset sees DeFi borrowing roar back 959% by 2024 amid CeFi decline appeared on BitcoinEthereumNews.com.
The total crypto lending market fell over 43% from its $64.4B peak in 2021 to $36.5B by Q4 2024. Centralized (CeFi) lending plummeted 68% from its 2022 peak, driven by major lender bankruptcies (Celsius, Genesis, etc.). Decentralized (DeFi) borrowing surged 959% from its late 2022 low, reaching $19.1B by Q4 2024. The landscape of cryptocurrency lending has undergone a dramatic transformation since its zenith, marked by a sharp contraction in centralized finance (CeFi) platforms alongside a vigorous resurgence in decentralized finance (DeFi) borrowing, according to recent industry analysis. Crypto lending cools from fever pitch Data published by Galaxy Digital on April 14 reveals a significant cooling in the overall crypto lending market. From a peak valuation of $64.4 billion in 2021, the market size had shrunk by more than 43% to $36.5 billion by the close of the fourth quarter of 2024. This downturn trajectory began its steep descent in 2022, catalyzed by the cascading failures of several prominent centralized crypto lenders. Firms like Genesis, Celsius Network, BlockFi, and Voyager, once titans of the industry, succumbed to the pressures of falling crypto prices and subsequently filed for bankruptcy. Their collapse triggered a significant contraction in both the availability of crypto loans and the demand for them. Centralized giants fall, market shrinks dramatically The impact on the CeFi lending sector was particularly acute. At its height in 2022, CeFi lending boasted a combined book size of $34.8 billion. By the end of 2024, however, this figure had plummeted to just $11.2 billion – representing a stark 68% decline. Zack Pokorny, a research associate at Galaxy Digital, attributed this sharp drop to foundational issues on both sides of the market. “The decline can be attributed to the decimation of lenders on the supply side and funds, individuals, and corporate entities on the…
Filed under: News - @ April 15, 2025 4:28 am