Over the past two years, Cardano has faced criticism for being a project that promises more than it delivers. But the activity has grown a lot on the network at the beginning of 2023, at least in the field of decentralized finance (DeFi) which, according to DeFi Llama, has grown by 36% on the network.
According to DeFi project tracker, Cardano holds $65.97 million in Total Amount Locked (TVL). This metric measures how much money investors and users leave behind DeFi on the network.
The TVL in the blockchain represents the total capital held in its smart contracts. TVL is calculated by multiplying the amount of collateral locked into the network by the current asset value.
The amount corresponds to an increase of approximately 36% compared to January 1, when Cardano’s TVL netted $48.5 million. That is, Cardano’s TVL grew by an average of 4% per day.
DeFi highlights on Cardano
This growth is important to keep Cardano competitive against its major competitors, such as Avalanche and Ethereum.
Among Cardano’s decentralized applications (dApp), the largest is Minswap, a decentralized exchange (DEX) that contains multiple blockchains. Minswap holds a total of $27.26 million in TVL, which is more than 41% of Cardano’s TVL.
The second most valuable custom dApp is Indigo, a decentralized trading platform for synthetic tokens. The platform is valued at $11.35 million in TVL, or about 17%. Finally, automated market maker WingRiders has $10.87 million in TVL (10.6% of TVL).
Among those dApps, Indigo and WingRiders showed the highest growth rates on the network in December. Both have achieved almost a 25% increase in their TVL in the past month.
ADA benefits
The jump in Cardano’s TVL indicates that the market is watching network developments. The higher the demand for DeFi projects, the more money investors leave on the blockchain. Network projects are rapidly growing and gaining more liquidity and usage.
This, in turn, is reflected by the rise in the price of ADA, the cryptocurrency that powers the Cardano network. According to CoinGecko, the price of ADA is $0.322 at the time of writing. Over the past seven days, the cryptocurrency has gained 20.1%, which is the largest percentage increase over the period among all the top ten cryptocurrencies.
Since the end of December, ADA has gained more than 31%. But ADA is still nearly 90% below its all-time high of $3.09, which it reached in September 2021.