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DeFi-Led Crypto Borrowing Hits Record $73.6B in Q3 on Stronger Collateralization

Galaxy Research says October’s $19B futures wipeout reflected exchange risk systems, not a credit failure.

Overview

  • Onchain lending now accounts for 66.9% of crypto-collateralized debt, with DeFi apps growing to about $41.0 billion and taking more than 80% of onchain activity as CDP stablecoins shrink to roughly 16%.
  • Centralized lenders rebounded to $24.37 billion under fully secured models, with Tether holding $14.6 billion in loans and roughly 60% of the tracked CeFi market as the top three lenders control about 76%.
  • New deployments accelerated borrowing on Plasma, which amassed over $3 billion in outstanding loans within five weeks, as Aave captured 68.8% of that chain’s lending and made it the protocol’s second-largest deployment after Ethereum.
  • Total industry debt reached a record $86.3 billion when including corporate digital-asset treasury issuance, with more than $12 billion tied to companies acquiring crypto.
  • The Oct. 10 liquidation cascade erased more than $19 billion in perpetual futures positions across exchanges, led by Hyperliquid with about $10.1 billion, followed by Bybit and Binance at roughly $4.6 billion and $2.3 billion respectively.