DeFi Faces Sharpest Weekly TVL Drop Since 2023

DeFi TVL plunged 12.45% in one week, signaling smart money pulling out and investors becoming extra cautious.

From 2021 to 2025, DeFi saw big ups and downs, with early 2021 spikes and mid-year crashes showing constant swings.

Volatility returned in 2024–2025, with money moving in and out quickly, making weekly gains and losses sharper than before.

DeFi platforms have recorded a steep liquidity exit this week. The Total Value Locked fell 12.45% on 9 November 2025 across major protocols, marking the sharpest weekly decline since the 2023 bear-market bottom

Smart money rotated out of major protocols as risk sentiment changed. Institutions cut exposure aggressively as “liquidity drained faster than it did during the FTX collapse.” Crypto Patel captured the mood, stating, “Either we’re at a generational buying opportunity… or the pain has just begun.” The scale of the decline raised questions about capital strength, market confidence, and potential contagion effects.

Besides this latest decline, the chart covering 2021 to 2025 shows repeated TVL volatility cycles. Early 2021 recorded strong expansions as weekly gains surged above twenty percent. Moreover, the first quarter logged a spike near forty percent as new capital flooded DeFi. However, mid-2021 delivered heavy drawdowns. One weekly drop reached negative thirty percent and marked one of the period’s most intense corrections.

Market Cycles Across 2022 and 2023

Movement during 2022 narrowed significantly as volatility cooled. Weekly swings stayed smaller and reflected slower liquidity growth. Several weeks still printed negative fifteen percent as DeFi faced broader market weakness. Gains also shrank as asset values declined across the sector. Consequently, capital flowed cautiously while speculation reduced.

2023 brought mixed conditions. Several recovery bursts delivered ten to fifteen percent weekly gains. Additionally, declines continued as consolidation phases formed through mid-year. Markets showed reduced speculative energy while liquidity entered ecosystems in shorter intervals.

Renewed Volatility in 2024 and 2025

Volatility strengthened again in 2024 as weekly movements widened. Gains pushed above fifteen percent multiple times as sector activity increased. Declines also deepened past negative ten percent during stressed periods. Hence, capital moved in sharper cycles as trading volumes expanded.

Early 2025 continued this pattern with alternating surges and pullbacks. Several weeks produced gains above fifteen percent. Declines occasionally matched that intensity. The sharp November fall ranked among the year’s largest contractions and signaled renewed caution across DeFi markets.

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