Ethereum TVL’s share falls to 54%, hitting a new low in nearly 2 years—how are competing chains reshaping the DeFi landscape?

On-chain data shows that Ethereum DeFi total value locked (TVL) as a share of the entire market has fallen to 54%, hitting a stage low since 2024. Meanwhile, its absolute locked value remains at $45.4 billion (USD), significantly higher than other public chains. This combination of “share declining but scale leading” reflects that the DeFi market is moving from single-chain dominance toward a phase of multi-chain coexistence. The change in share is not simply a matter of capital flowing out, but more that newly added liquidity is being allocated across multiple chains in a dispersed manner.

Why doesn’t the absolute scale of $45.4 billion stop Ethereum’s share from continuing to fall?

Ethereum’s $45.4 billion TVL absolute value still represents the largest single capital pool in the DeFi market today, exceeding the combined total of the second- to fifth-ranked public chains. But its share has dropped from about 63% at the start of 2025 to 54%, meaning incremental capital is flowing more into other ecosystems. This phenomenon is driven by multiple factors: new public chains offer higher capital efficiency, lower transaction fees, and differentiated native application scenarios. Although the Ethereum mainnet has expanded throughput via Layer 2, the mainnet interaction cost is still unfriendly for mid-sized capital, leading some deployments to adopt a multi-chain strategy. The ability to retain capital has not weakened, but the preferred deployment environment for new capital is becoming diversified.

Which competing chains are eating into Ethereum’s DeFi market share?

Solana, Base, and BNB Chain have become the three public chains with the most significant share growth over the past three quarters:

• Solana relies on high-concurrency processing and a low-fee environment, attracting professional market-making capital in derivatives trading and high-frequency DeFi;
• Base, backed by tight integration with the Coinbase ecosystem and the Optimism tech stack, has rapidly grown in retail-grade DeFi applications;
• BNB Chain, through stablecoin incentive programs and cross-chain bridge optimizations, continues to absorb mature protocol deployments from the Ethereum ecosystem.

Data shows that the combined TVL share of these three chains has risen from 22% at the end of 2025 to about 31% today. Among them, Solana alone has surpassed 12%, becoming the largest DeFi-carrying network outside Ethereum.

Can Layer 2 expansion help Ethereum reclaim its lost TVL share?

Ethereum’s Layer 2 ecosystem is undergoing significant changes. The combined TVL of Arbitrum, Optimism, Base, and zkSync Era now exceeds 42% of Ethereum mainnet’s locked amount. But in terms of share, Layer 2 TVL growth has not fully converted into an overall increase in Ethereum’s share, because some capital moves directly from other public chains into Layer 2 rather than being settled and accumulated via the mainnet. In addition, the liquidity fragmentation issue between Layer 2 networks still exists: the cost and latency of bridging across Layer 2 weaken the competitiveness of a unified liquidity pool. If, in the future, native cross–Layer 2 interaction protocols mature, and Ethereum mainnet blob transactions further reduce Rollup costs, Ethereum’s overall share could stabilize again. However, reclaiming to above 60% would require competing chains to experience clear safety or liquidity events.

How is cross-chain liquidity reallocating DeFi’s capital efficiency?

The maturity of cross-chain bridges fundamentally changes the logic of capital deployment. Users no longer need to lock all their assets on a single chain; instead, they can flexibly allocate across chains based on yield, security, and exit liquidity. Current mainstream cross-chain protocols already see daily transaction volume exceeding $2.5 billion, with about 40% of the traffic occurring between Ethereum and Solana/BNB Chain. This liquidity-connection mechanism reduces Ethereum’s network locking effect, enabling capital to complete cross-chain migration within minutes. For protocol teams, multi-chain deployment has become standard configuration, and the exclusivity advantage of a single chain is being replaced by interoperability. Asset efficiency is prioritized over ecosystem loyalty, becoming the core variable determining where TVL flows.

Which adjustments in the Ethereum ecosystem will be triggered by the 54% share threshold?

As the share rate keeps pressing toward the psychological 50% mark, it has already triggered strategy reflection across both the developer community and the capital side. The Ethereum Foundation and the core development teams have recently accelerated execution-layer optimizations in the Pectra upgrade, focusing on reducing Gas consumption for specific mainnet operations. At the same time, re-staking protocols such as EigenLayer attempt to export Ethereum’s security to other chains by introducing external validation services, turning a competitive relationship into a symbiotic one. If this strategy succeeds, Ethereum would shift from “carrying all DeFi activity” to “serving as the security and settlement base,” and share would no longer be the only metric for measuring its value. But if competing chains continue expanding at the current pace over the next two quarters, Ethereum’s share may test the 48% to 50% range before the end of 2026.

FAQ

Q1：Does the decline in Ethereum TVL share mean DeFi capital is massively withdrawing?

A：No—it’s not capital withdrawing; incremental capital is being allocated more dispersedly across multiple public chains. Ethereum’s absolute TVL of $45.4 billion is still at a historically high level.

Q2：Which segments drive Solana’s DeFi growth mainly?

A：Primarily from derivative trading protocols, high-frequency lending markets, and stablecoin exchange pools tightly integrated with fiat on-ramps.

Q3：Is Layer 2 TVL included in Ethereum ecosystem share?

A：In general statistical terms, Layer 2 TVL is usually included in Ethereum ecosystem’s total share. But in market analysis, researchers split mainnet and L2 to observe changes in liquidity distribution.

Q4：Which competing chain is most likely to threaten Ethereum’s dominant position?

A：No single chain can directly threaten Ethereum yet. Solana leads in trading experience, but it still has a significant gap versus Ethereum in asset-settlement depth and protocol diversity. The longer-term direction is multi-chain coexistence.

Q5：How should investors view the impact of TVL share changes on asset allocation?

A：TVL share changes reflect the competitive landscape of infrastructure and do not constitute a direct evaluation of any specific asset. Allocation decisions should be based on independent assessments of each chain’s security, liquidity, and application ecosystem.