What happened?
DeFi reached a record $237 billion in TVL in Q3 2025, largely driven by stablecoins and ongoing protocol development. At the same time, daily active wallets plunged about 22% to roughly 18.7 million, with AI and Social dapps hit hardest. Ethereum still commands about half the TVL while Solana and some other chains saw big losses, NFTs surged and hackers stole around $434 million.
Who does this affect?
Retail users are clearly affected as falling daily activity shows many smaller wallets leaving or using apps less. Protocols, chains and dapps that rely on user activity—like Solana, Social and AI projects—face lower liquidity and revenues, while DEXs and platforms offering perpetuals are competing for the remaining capital. Institutional players, stablecoin issuers and large liquidity providers stand to gain from concentrated capital, but everyone suffers if security breaches keep happening.
Why does this matter?
For markets, rising TVL with falling users means capital is concentrating, which can lift fees and token prices but also makes markets more fragile to big withdrawals. The push of stablecoins, bigger NFT volumes and centralized-like features on DEXs could draw institutional money and change where trading volume sits. Still, large hacks and a retail pullback increase systemic risk, could spark volatility or regulatory pressure, and ultimately affect prices, yields and liquidity across the DeFi ecosystem.