Ethereum's DeFi share slips below 68% as challengers gain ground
Ethereum (ETH) remains the largest DeFi hub, but its share of total DeFi activity fell below 68%, highlighting accelerating competition from Layer‑2 networks and alternative blockchains. Lower transaction costs on L2 rollups, aggressive liquidity mining on non‑ETH chains, and expanded stablecoin issuance elsewhere are funneling volume and capital away from base‑layer Ethereum. Cross‑chain bridges and improved UX are amplifying the effect by making it easier for users to chase yield outside the ETH mainnet.
The decline matters because it increases liquidity fragmentation and raises tradeoffs between composability and cost. Developers may prioritize where they can attract user activity, while users weigh better yields against security and bridge risk. Market watchers should track TVL redistribution, bridge flows, and fee trends to gauge whether this is a temporary rotation or a longer‑term multi‑chain equilibrium that reshapes DeFi capital allocation.