Total value locked in DeFi has retraced from its cycle high. The headline number obscures rotation: capital is leaving certain protocols and arriving at others.
The flows
Lending protocols (Aave, Compound) have seen steady outflows. Liquid restaking and LST protocols continue to absorb deposits.
What this signals
Capital is migrating toward yield-bearing assets with real cashflows. The lending side is being repriced as base rates normalize.