Decentralized financial applications (DeFi) have become one of the most affected industries in the crypto market amid macroeconomic uncertainty and declining user activity in 2025.
Experts interviewed by The Block attribute this to the immaturity of the DeFi market and increased investor interest in centralized solutions.
"This is an illustration of how market uncertainty can significantly affect decentralized finance, which also captures the overall decline in activity in the bitcoin and Ethereum blockchains against the backdrop of a global correction," said Vincent Liu, Director of information Technology at Kronos Research.
The prices of cryptocurrencies have decreased significantly compared to the peak values in December 2024 and January 2025. Bitcoin dropped to $83.5 thousand from a historical high of about $ 110 thousand, recorded in January.
Ethereum (ETH) has fallen in price from the December local peak of $4.1 thousand to $1.8 thousand, according to CoinMarketCap on April 5. At the same time, the absolute maximum of ETH remains at the level of November 2021 - about $ 4,9 thousand.
The total amount of user funds placed in DeFi applications decreased by 30%, from $135 billion on December 20, 2024 to $94.5 billion on April 5, 2025.
The absolute record for this indicator was recorded in November 2021, when the amount of blocked funds exceeded $170 billion, according to DefiLlama.
According to the report of the DappRadar analytical platform for the first quarter, the DeFi market showed a decrease in activity in almost all key blockchain networks - with the exception of Berachain.
This network, launched in early February, quickly moved to seventh place in terms of blocked assets: by April 5, the figure was about $3 billion, indicating a fourfold increase since launch, according to DefiLlama.
Against the background of a decrease in user activity, the total revenues of DeFi protocols also fell sharply. Since the January peak of $291 million, they have more than tripled by March, according to data from the analytical platform The Block.
https://www.theblock.co/data/decentralized-finance/protocol-revenue/monthly-defi-revenue
This also correlates with a drop in the share of decentralized crypto exchanges relative to centralized ones in terms of comparative trading volume, at a level below 11.3%. This is the lowest since September 2024, and the historical peak occurred in January 2025 with an indicator of 22%, according to The Block on April 5.
Experts point out that one of the factors reducing activity in the DeFi market may be the perception of retail investors: many still consider decentralized applications to be too complex compared to centralized counterparts.
At the same time, experienced traders prefer higher liquidity and convenient tools offered by centralized platforms.
"Overall, the DeFi ecosystem has matured significantly in recent years, but it still has a long way to go to integrate with institutional players and financial products — this is necessary to create competitive conditions and ensure a level of security comparable to that offered by licensed exchanges today." — Kevin Guo from HashKey noted.
"In the decentralized finance sector, constant innovation as well as price stability for cryptocurrencies are crucial. Under these conditions, the recovery of the sector will depend more on macroeconomic data on the type of inflation, as well as the revision of trade duties in the United States," said Vincent Liu from Kronos.
In these indicators, it is worth considering that Ethereum occupies a leading position in the DeFi application market in almost all indicators - for example, the share of Ethereum in the amount of user funds blocked in DeFi exceeds 52.5%.
While the closest competitors in the face of blockchain networks Solana, BNB Chain and bitcoin have shares of about 6% each. And, for example, the dynamics of the amount of user funds in the DeFi ecosystem correlates with Ethereum quotes.
