What is Total Value Locked (TVL)?

Adekunle Joshua

Total Value Locked (TVL) represents the total amount of cryptocurrencies deposited in a DeFi ecosystem

TVL reveals the health of a DeFi protocol and its native tokens

This metric is essential for analyzing interest in a crypto platform over time

TVL doesn't include rewards earned from deposits; it only reflects the current value of the deposits themselves

TVL can change due to deposit/withdrawal levels and the fluctuating dollar value of assets

Traders use TVL to determine if a token's value is real, helping to assess if a DeFi protocol's native token is over/undervalued

TVL reflects the spot value of staked assets, including savings accounts, loan collaterals, futures contracts, and liquidity pools

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