The decentralized finance (DeFi) has not been spared from the recent crypto onslaught. This crash that had finally put top coins like Bitcoin and Ethereum 50% below their all-time high values had also dragged the DeFi market down with it. What has resulted is a near 50% drop in total value locked (TVL) across all decentralized finance protocols, which had been trending as high as $190 billion before the crash begun.

DeFi Market Slides Down

The beginning of May saw the DeFi market starting out at nearly $200 billion in total TVL. Now, while the market had been trending down prior to the new month, there had not been any significant moves that would be a call for alarm. It was only recently that this began to change as the crypto market saw one of the most brutal drawdowns in recent memory.

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After losing about $20 billion in the course of the last week of April, DeFi had finally come into the crash on May 9th. During the span of three days, it had seen about $30 billion in TVL wiped off the market. This brutal downtrend would prove to only be the beginning though given what came after.

May 9th had started with $180 billion in total TVL. However, by May 11th, this had declined to $150 billion. Even as investors hoped for recovery though, there would be none in sight. What followed was another drawdown that brought the total losses to a little over 40% of market TVL.

DeFi market cap at $60.4 billion | Source: Crypto Toal DeFi Market Cap on TradingView.com

Presently, the TVL of the DeFi market is at $112.46 billion across all existing protocols. To put this in perspective, the highest TVL had been a little over $252 billion. This was in December of 2021 shortly after the December 4th crash. This would mean that the total DeFi space has seen more than $140 billion wiped off in the space of five months.

Terra Gets The Short End 

DeFi protocol Terra has been at the front and center of the recent market downtrend. Most of the crash is, in fact, attributed to the massive losses that have been incurred by investors in the network. However, just as the native tokens of the blockchain had recorded massive losses, so has the TVL on the network.

Terra had grown through the last couple of months to become the second-largest DeFi platform by TVL. It had clinched this title for itself by beating out top players such as BSC and Avalanche with a TVL that eventually peaked at $31.35 billion on April 6th.

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Now, the network has been booted out of the top 10 DeFi platforms after losing more than 90% of its total value locked. This figure now sits at a measly $515.14 million at the time of this writing and dropping by the second.

Elsewhere, LUNA is not doing so hot either. Its supply has surpassed 24 billion and growing as users take advantage of the arbitrage opportunity that presented itself with the UST and LUNA staking. The price of the coin has effectively gone to zero on major exchanges, while others such as Binance, eToro, and Bybit have delisted the cryptocurrency from their platforms.