How did the DeFi lending market react to the investor sell-off?

The cryptocurrency market has entered a deep correction since the beginning of October 2025, shortly after Bitcoin set a new all-time high. Along with the price decline, borrowing activity in the market has also narrowed significantly, especially in the decentralized finance sector.

Data from CryptoQuant shows that the amount of stablecoins borrowed weekly on Aave has plummeted from a peak of $6.2 billion in early August to approximately $1.9 billion at the end of November, a drop of 69%. This development reflects increased risk aversion as investors limit leverage amid continuously declining collateral asset prices. However, the total outstanding debt on Aave remains around $16.3 billion, indicating that the core of the DeFi lending market remains relatively stable.

Conversely, the centralized lending platform Nexo has seen a recovery in retail lending demand as the market continues to plummet. Instead of selling off assets, many investors are opting for collateralized loans to maintain their positions.

Meanwhile, the total market TVL of DeFi has fallen to approximately $117.9 billion, mirroring a nearly 30% drop in Bitcoin from its peak. Despite short-term pressures, observers expect 2026 to usher in a wave of institutional DeFi, driven by a clearer regulatory framework and increasing practical application demand.

ETH
ETHUSDT
2,954.07
+0.36%

AAVE
AAVEUSDT
152.88
+3.21%