Ethereum's DeFi Dominance Drops Below 55% as Competing Blockchains Gain Traction in 2025

Ethereum’s dominance in decentralized finance (DeFi) has eroded significantly in 2025, with its share of the total value locked (TVL) in DeFi dropping from 63.5% at the start of the year to approximately 54% as of May 7. This decline brings Ethereum’s market share near its lowest recorded level since May 2025, according to data from DefiLlama.

As of May 7, Ethereum’s TVL stands at $45.4 billion, but the ecosystem is no longer the sole hub for DeFi activity. Instead, the space has fragmented into a network of specialized blockchains, each carving out distinct roles. Competing chains now hold significant portions of DeFi TVL, including:

• Solana: 6.66% ($4.4 billion TVL)
• BNB Chain: 6.60% ($4.36 billion TVL)
• Bitcoin: 6.35% ($4.21 billion TVL)
• Tron: 6.17% ($4.09 billion TVL)
• Base: 5.44% ($3.61 billion TVL)
• Hyperliquid: 1.81% ($1.2 billion TVL)

This shift reflects a broader trend: DeFi is evolving from a single Ethereum-centric model into a multi-chain ecosystem, where each blockchain specializes in different functions such as decentralized exchange (DEX) flows, stablecoin settlement, Bitcoin collateralization, consumer onboarding, and perpetuals trading.

BNB Chain: Binance’s Ecosystem Captures DeFi Volume Through PancakeSwap and Alpha Integration

BNB Chain has strengthened its position by leveraging Binance’s distribution network. In the second quarter of 2025, PancakeSwap’s trading volume surged 539.2% quarter-over-quarter to $392.6 billion, accounting for 45% of the top-10 DEX volume, according to CoinGecko. Binance Alpha routes trades directly through PancakeSwap, deepening the integration.

DefiLlama data shows BNB Chain currently holds $5.55 billion in TVL, with $739.6 million in 24-hour DEX volume. Binance has further embedded PancakeSwap into its ecosystem via Alpha Earn, allowing users to provide liquidity to PancakeSwap V3 directly from the Binance Wallet. Additionally, Alpha 2.0 integrates DEX trading directly into the Binance Exchange interface, creating a seamless flow where Binance controls the front end, PancakeSwap executes trades, and BNB Chain captures the volume.

Tron: The Stablecoin Settlement Backbone with Minimal App Diversity

Tron operates as a high-throughput dollar-settlement rail, specializing in stablecoin flows rather than app diversity. DefiLlama reports $89.6 billion in stablecoins on Tron, with USDT accounting for 97.86% of that total. Despite this, Tron’s 24-hour DEX volume is just $55.5 million, and its DeFi TVL stands at $5.19 billion.

While Tron’s app ecosystem is thin, its role in facilitating the largest stablecoin flows in crypto underscores its importance as a settlement layer for dollar-denominated transactions.

Bitcoin: The Emerging Yield and Collateralization Layer for DeFi

Bitcoin’s DeFi TVL has reached $5.34 billion, representing 6.35% of the total DeFi market—a 13.4% increase over the past 30 days. Despite a relatively low 24-hour DEX volume of just $338,516, Bitcoin’s role in DeFi is expanding as a productivity layer where capital generates yield through collateral and lending protocols.

The BTCFi thesis is gaining traction, with capital migrating onto Bitcoin to earn yields and serve as collateral for DeFi activities.

Base: Coinbase’s Ethereum L2 Steals Share from Ethereum L1

Base, Coinbase’s Ethereum layer-2 (L2) built on the OP Stack, has become a major competitor by leveraging Coinbase’s global distribution network. Base operates in more than 140 countries, and its TVL stands at $4.58 billion, with $4.93 billion in stablecoins and $854.97 million in 24-hour DEX volume.

Critically, activity migrating from Ethereum L1 to Base continues to settle within Ethereum’s security model. Coinbase has packaged Ethereum blockspace behind its consumer distribution layer, routing activity through a Coinbase-operated execution environment. This model allows Base to erode Ethereum L1’s headline share while remaining secured by Ethereum.

Hyperliquid: The On-Chain Perpetuals Powerhouse

Hyperliquid is redefining DeFi liquidity by organizing it around execution quality. The platform’s TVL is $1.52 billion, but its trading volumes are staggering: $9.37 billion in 24-hour perpetuals volume, $42.4 billion over seven days, and $8.94 billion in open interest.

Hyperliquid operates fully on-chain, offering perpetual and spot trading with a focus on performance and efficiency. Its rapid growth highlights a shift toward execution-driven DeFi ecosystems.

Key Takeaways: The Multi-Chain DeFi Future

• Ethereum’s DeFi dominance has dropped from 63.5% to 54% in 2025, nearing its lowest level since May.
• Competing chains like Solana, BNB Chain, Bitcoin, Tron, Base, and Hyperliquid are capturing market share through specialization.
• BNB Chain leverages Binance’s ecosystem, while Tron dominates stablecoin flows.
• Bitcoin is emerging as a yield and collateralization layer, and Base is eroding Ethereum L1’s share through Coinbase’s distribution.
• Hyperliquid proves that liquidity can thrive on execution quality alone.