Digital Asset Lending Surpasses 2021 Peak with $61.7B TVL in June 2025

Digital asset lending has crossed a significant milestone, surpassing its 2021 peak to reach $61.7 billion in total value locked (TVL) as of June 2025. This growth is driven by a resurgence in both centralized (CeFi) and decentralized (DeFi) lending platforms, with DeFi loans alone hitting $26.47 billion and CeFi reaching $17.78 billion. Including debt from Digital Asset Treasury Companies (DATCO) and estimated ETF-related borrowing, the total lending value exceeds $61.76 billion, marking a new all-time high [1].

The renewed strength in CeFi lending reflects a shift toward efficiency and structured returns. Platforms have refined their offerings, offering more competitive rates and improved risk management. This is evident in the 14.66% quarterly growth in CeFi loans, fueled by increased demand from institutional players and corporate treasuries seeking yield in a low-interest-rate environment [1]. The inclusion of $12.74 billion in DATCO debt and an estimated $3–$6 billion in ETF-related borrowing further amplifies the scale of lending activity, with these figures not fully accounted for in traditional lending metrics [1].

Meanwhile, DeFi lending has experienced a sharp 42.11% quarterly growth, reaching $26.47 billion in outstanding loans. However, this growth is not necessarily indicative of broader user adoption. The number of active Ethereum addresses has declined by 27% compared to May 2021, suggesting that much of the increase in volume is driven by looping strategies—repetitive borrowing and restaking mechanisms that artificially inflate lending activity [1]. These tactics, while beneficial for short-term volume metrics, may signal the presence of incentive-driven bubbles that could destabilize the market if left unchecked.

The role of DATCOs and ETF-backed lending is also reshaping the landscape. These entities leverage classical debt instruments to purchase crypto assets, creating a form of hidden leverage that remains under the radar for most market participants. Analysts note that $3.65 billion in DATCO debt is set to mature in June 2028, highlighting the importance of monitoring long-term debt obligations within the sector [1]. The relatively low loan-to-market-cap ratio (~1.5%) suggests that the lending sector still has room to grow without posing systemic risks, provided platforms continue to manage collateral and liquidity prudently.

The broader implications of this growth point to a maturing crypto ecosystem. Unlike the speculative frenzy of 2021, today’s lending activity is increasingly utility-driven. Borrowers are accessing liquidity without selling their holdings, while lenders are seeking stable returns in a bearish market. This shift mirrors traditional financial models and signals the potential for crypto-backed lending to become a foundational component of global finance [1].

Sustained growth will depend on continued innovation, regulatory clarity, and macroeconomic stability. If the 30% year-over-year increase in TVL is maintained, the sector could reach $75 billion by mid-2026. However, this remains a projection and is contingent on the performance of major crypto assets and broader market conditions [1].

Source: [1] Cointribune (https://www.cointribune.com/en/crypto-digital-asset-lending-reaches-61-7b-and-finally-surpasses-its-2021-record/)