Compiled by: Bai Hua Blockchain

Since the DeFi Summer of 2021, we have come a long way. Today, DeFi has formed several mature domains with the ability to self-sustain and remain active.

However, this is still in the early stages, as the crypto market capitalization is around $3.3 trillion, while the traditional finance market is as high as $133 trillion. This article will take a look at some observations about the industry-leading platforms.

The core idea of DeFi is to provide a more innovative and efficient system to solve the main inefficiency problems of traditional finance through proven product-market fit (PMF). Similarly, DeFi is composed of multiple key domains, which often exhibit an oligopolistic structure.

So, how is the situation today?

1. DEX

First, let's look at decentralized exchange platforms (DEXs): In Q4 2024, @RaydiumProtocol surpassed @Uniswap with a market share of around 61%, becoming the leader in this field.

Although its total value locked (TVL) is only about 39% of Uniswap's. While this may be related to the memecoin craze on @solana, its long-term performance remains uncertain.

In the perpetual contract DEX domain, we have a clear winner.

Since Q3 2024, @HyperliquidX's market share has risen from 24% to 73% (a 3-fold increase). Since Q4 2024, the overall trading volume of perpetual contract DEXs has continued to grow, with the current daily trading volume of around $8 billion, compared to $4 billion at that time.

HL (Hyperliquid) is gradually challenging centralized exchanges, trying to become the main price discovery platform in the crypto market.

2. Lending

The lending domain is similar. Since 2024, @aave's industry dominance in lending and borrowing has become increasingly evident:
Deposits: from 42.1% to 65.78%
Borrowing: from 31% to 61%

Even without the most attractive yields, Aave remains the platform of choice due to the long-established reputation and credibility of the protocol.

@pendle_fi is leading the yield space, setting a historical high Ethereum TVL (around 1.59 million ETH).

Its unique value proposition is to be the key driver of value discovery in this domain, despite the DeFi market slowdown and bearish sentiment, it still maintains the historical high TVL.

This clearly demonstrates its strong product-market fit (PMF).

3. Liquid Staking Platforms

Liquid Staking is undoubtedly the largest DeFi domain by TVL (around $35 billion).

@LidoFinance is the undisputed leader, controlling about 70% of the market share, almost monopolizing the LST market. Its TVL ($24.8 billion) is 5.17 times that of the second largest competitor @binance's $bETH ($4.8 billion).

This dominance is not driven by staking yields, but by the asset value of $stETH:
Best asset utilization: As the most integrated asset in DeFi.
Most trusted service: Becoming the preferred staking solution for funds and institutions.
Here, credibility and trust are the key drivers of widespread adoption.

As for liquid restaking, we also see similar trends in user concentration.

Notably, @ether_fi's market dominance has increased significantly (from 35.3% to 63%), with its TVL growing by about 770% in 2024, even maintaining growth after the S1 and S2 stakedrop ended.
This growth is mainly due to:

• First-mover advantage in ecosystems like @eigenlayer, @symbioticfi and @Karak_Network.
• Broad DeFi integrations
• Trusted product suite

@Lombard_Finance's performance in the BTC-Fi domain is highly similar to the trends in the LST/LRT domain, steadily rising to 49.5%.

As @babylonlabs_io matures (currently $5.5 billion market cap), the demand for $BTC as the preferred crypto safe-haven asset is expected to grow exponentially, with a market opportunity of up to $2 trillion.

@Lombard_Finance has already taken a dominant strategic position. With $LBTC as the most widely integrated, used and security-focused LRT in DeFi, Lombard is positioning it as the preferred asset for institutional trust and widespread adoption, similar to the role of $stETH. Details: https://x.com/0xCheeezzyyyy/status/1886623732770463885

4. Conclusion

In summary, the various DeFi domains have found their own positions, complementing each other to form a complete ecosystem. This marks the rise of a new native financial model, destined to disrupt centralized finance (CeFi), and we are fortunate to witness this process.

As we enter the next stage of expansion, there will be more efforts to explore new vertical domains, enter untapped markets, and even integrate with CeFi:

• @ethena_labs plans to integrate traditional financial payment systems
• @Mantle_Official's Mantle Index Fund and Mantle Bank plans to combine crypto and traditional finance

With more institutional attention, such as @BlackRock's participation in DeFi through $BUIDL, and @worldlibertyfi's DeFi portfolio and spot ETF, the future potential looks very promising.

Link to the article: https://www.hellobtc.com/kp/du/02/5670.html

Source: https://x.com/0xCheeezzyyyy/status/1888773047433535884