Report: Tether, Galaxy, Ledn Lead CeFi Crypto Lending, On-Chain DeFi Lending Soars

On April 15th, Galaxy Research, a digital asset investment firm, presented a report indicating that the scale of the cryptocurrency lending market remains notably lower than the level prior to the harsh crypto winter spanning from 2022 to 2023. Nevertheless, beneath the surface, indications of recovery are beginning to manifest, particularly within the decentralized sector. The report discloses that by the conclusion of 2024, the overall size of the cryptocurrency lending market reached $36.5 billion, encompassing loans collateralized by cryptocurrency-backed stablecoins. This constitutes a substantial decline from the peak of $64.4 billion during the 2021 bull market when crypto lending witnessed a surge due to speculative fervor. The market downturn was triggered by the collapse of prominent lending institutions such as Celsius, BlockFi, and Genesis, with a few major players exerting dominance in the centralized finance (CeFi) lending arena. The report states that Tether holds the largest market share, followed by Galaxy and Ledn. These three entities account for nearly 90% of the $11.2 billion CeFi loan portfolio. It is worthy of note that CeFi loans have decreased by 68% from their zenith of $34.8 billion in early 2022. However, genuine growth is occurring on-chain. Decentralized lending protocols enable users to borrow cryptocurrency assets by pledging collateral and operate continuously around the clock without relying on centralized entities. Such protocols are evolving at a rapid pace. Galaxy reports that since the market reached its nadir at the end of 2022, the outstanding DeFi loans have surged by 959%, increasing from $1.8 billion to $19.1 billion and encompassing 20 applications and 12 blockchains.