Decentralized Finance Application (DeFi) transactions hit a one-year low. At the same time, DeFi has become the niche cryptocurrency that has been hit the hardest by this year’s cryptocurrency price drop, as reported by the team at decentralized app tracking site DappRadar.
The report says that DeFi’s annual transaction low observed in the first quarter of this year shows that interest in the DeFi space has dropped significantly since last summer. Notably, the drop in DeFi transactions exceeds the drop in the crypto-gaming category, while transactions related to non-transferable token trading (NFT) increased during the quarter.
However, despite the decline in the number of transactions, the total blocked value (TVL) in DeFi protocols continued to grow during the quarter.
Growth was fueled by strong growth in the amount of funds stored in DeFi protocols built on Ethereum alternatives (ETH) such as Terra (LUNA), Solana (SOL) and Avalanche (AVAX).
Looking only at Ethereum, TVL declined during the first quarter, this is DappRadar data. From $132.8 billion on January 1, Ethereum’s TVL decreased to $115.9 billion on March 31.
It’s worth noting that the decrease in TVL was due to the fact that the price of ETH fell from $3,680 at the beginning of the quarter to $3,280 at the end of the quarter, that is, by about 10%.
The DappRadar report also says that NFT-related transactions peaked in the first quarter of this year, up 153% from the same quarter last year. Most of the growth was seen in alternative networks such as Avalanche and Solana, while NFT-related transactions on Ethereum have remained stable since January.
Cryptocurrencies saw a 520% year-over-year increase in transactions from the first quarter of last year, far outpacing activity in the DeFi sector. Moreover, both NFT and cryptogames have reached a point where they have become “critical to the development of the crypto industry.”