Ethereum has become a platform for high-value finance

Ethereum’s market cap vs ecosystem TVL

• Ecosystem total value locked (TVL) for Ethereum has established a floor for ETH's market cap during market downturns. Ecosystem TVL refers to the total value of funds deposited into the applications on the chain. This includes deposits to stablecoin & RWA issuers (measured as the tokenized AUM), lending projects, liquid staking projects, and more. Since 2020, ecosystem TVL on Ethereum grew from $24B to $379B (16x), while ETH's market cap increased from $47B to $502B (11x). During the 2022 bear market and April 2025 correction, ecosystem TVL provided visible support at progressively higher levels.

• Three market sectors account for 93% of Ethereum's ecosystem TVL: stablecoin issuers ($189B), lending ($82B), and liquid & restaking ($73B). A handful of projects lead each market sector: Tether has 85% market share among stablecoin issuers, Aave has 62% market share in lending, while Lido & EigenLayer control 73% of the liquid staking category. Capital continues to accumulate in projects that provide users with deep liquidity and battle-tested security.

• Ethereum's current ecosystem TVL of $379B represents a small share of the market cap of TradFi assets that could be tokenized. BlackRock currently manages $13.5T in assets, yet has only $2.9B onchain. Fidelity manages $6.4T, but has a mere $231M on Ethereum. Should institutions follow through on their stated intentions of bringing assets onchain, we could see a 10x increase in ecosystem TVL on Ethereum over the next few years. If more assets are tokenized on Ethereum, and the correlation between ecosystem TVL and ETH's market cap continues to hold, ETH could see a substantial rerating.

Contract deployments vs ecosystem TVL on Ethereum

• Contract deployments on Ethereum have declined since 2021, while ecosystem TVL continues to trend upward. Contract deployments measure the number of new smart contracts launched on Ethereum and serve as a proxy for developer activity and ecosystem experimentation. Deployments peaked at 5.9M in Q2 2021, but have since declined by 95% to 310K in Q3 2025. Ecosystem TVL grew from $120B to $379B during the same period. This inverse relationship shows capital concentrating in established DeFi rather than novel applications.

• L2s and alternative L1s absorbed experimentation, and captured this market cycle's breakout applications. Lower costs and higher TPS on L2s & alternative L1s, like Base and Solana, made them the rational choice for developers building new apps. The standout apps emerged on these chains: pump.fun on Solana has generated $866M in fees since January 2024, as Solana's ecosystem TVL grew from $4.3B to $37.3B. Over the same period, Aerodrome on Base generated $408M in fees, while Base's ecosystem TVL grew from $425M to $11.7B. Ethereum L1 has retained established DeFi projects, while L2s and alternative L1s have captured the attention of new application developers.

• Historical patterns suggest that contract deployments & ecosystem TVL growth are linked—re-enabling innovation on the Ethereum L1 could boost TVL further. The Q2 2021 deployment peak of 5.9M preceded Ethereum's ecosystem TVL ATH later that year. This correlation exists on L2s as well: Base saw 167.5M contract deployments in Q2 2025 and has since grown to $11.7B in ecosystem TVL. Ethereum’s Fusaka upgrade in December could reduce costs and increase TPS enough to bring experimentation back to the L1. If Ethereum recaptures even a fraction of the deployment activity on chains like Base and Solana, it could re-accelerate TVL growth on the L1.

Active loans on Ethereum & L2s vs other chains

• The Ethereum ecosystem controls 90% of active loans across all chains, up from 52% in June 2022. Active loans measure the total dollar value currently borrowed across DeFi lending projects. The Ethereum L1 and leading L2s command 90% of this market, while other chains hold just 10%. The 38 percentage point recovery from 2022 demonstrates capital consolidating around the most liquid lending & borrowing platforms.

• Capital has chosen battle-tested projects on the Ethereum L1, and followed these projects as they've deployed on L2s. Since June 22, Aave on Ethereum grew TVL or deposits from $10.6B to $50B, while expanding to L2s like Arbitum, Base, and more. Sky scaled deposits from $9.5B to $14B, following a similar pattern. Newer entrants to the lending market sector found significant growth on L2s: Morpho became the largest lending platform on Base, with $3.2B in deposits.

• The Ethereum ecosystem's dominance in lending is increasing and continues to benefit from a liquidity network effect. Deeper liquidity provides better rates, which attracts more borrowers, which attracts more lenders, and so on. For capital allocators that evaluate where to earn the best risk-adjusted yield, Ethereum's ecosystem has a strong value proposition with proven security and compounding liquidity network effects.

Access the charts here.

6 new projects are live on Token Terminal

New standardized listings (full listing with up to 15 metrics)

1. Thena, a DEX on BNB Chain.

2. Etherex, a DEX on Linea.

3. Darwinia Network, a blockchain for interoperability and DeFi infrastructure.

4. Zeitgeist, a prediction market platform powered by Polkadot.

5. Heima, a specialized identity and data verification blockchain.

6. Aventus, an L2 blockchain for enterprise applications.

Expanded coverage

• Aave and Spark now include granular breakdowns by asset, chain, and more.

• Uniswap and Tether metrics now available on Plasma.

Interested in getting listed? Read more here.

Methodologies are live

Understanding how onchain metrics are calculated shouldn’t require guesswork. We recently launched Methodologies, a new feature that documents every calculation step between raw blockchain data & standardized financial and usage metrics.

Each metric page on Token Terminal is now accompanied by a separate Methodology tab that is structured into three sections:

1) Overview: what the metric measures.
2) Data sources: which blockchain events, function calls, smart contracts’ state, or transactions are used.
3) Step-by-step calculation: how the raw data becomes the final output.

Maintaining accurate methodologies at scale is only possible with the right infrastructure. Token Terminal’s end-to-end data pipeline – combined with our proprietary Methodology agent – allows us to continuously update & regenerate methodologies without manual overhead.

You can find a Methodology tab on all project pages.