Crypto lending reaches new peak driven by strong DeFi growth

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Yaroslav Dmytrenko

21.11.2025

Crypto lending reaches new peak driven by strong DeFi growth — Galaxy reports major expansion in DeFi lending to $41B

Lending activity in decentralized finance has reached a new quarterly high. According to the latest report from Galaxy Digital, the total volume of active loans issued through DeFi applications has approached $41 billion.

Galaxy’s research team noted that borrowing activity in DeFi grew by roughly $14.5 billion, or nearly 55%, in the third quarter of 2025. This surge helped push the combined crypto lending market — across both DeFi and CeFi — to almost $73.6 billion, setting a new all-time high.

CeFi + DeFi lending by Q3 2025. Source: Galaxy Digital, The Defiant

The previous peak of $69.3 billion was recorded at the end of Q4 2021.

The new report shows that record-level borrowing was driven by several factors: airdrops, points programs, higher-quality collateral products, and rising asset prices, all of which increased users’ borrowing capacity as their collateral appreciated.

However, Galaxy also warned about potential double-counting between CeFi and DeFi data. Report author and Galaxy research fellow Zak Pokorny explained that some CeFi lenders borrow on-chain and then issue loans off-chain — which may appear twice in aggregated data without explicit disclosure.

“For example, a hypothetical CeFi lender could pledge unused BTC for an on-chain USDC loan, and then lend that USDC to a borrower off-chain. In this scenario, the on-chain loan would appear in DeFi open lending data, while the off-chain loan would show up in the lender’s financials as an outstanding client loan,” Pokorny wrote.

DefiLlama reports even larger figures

Galaxy Digital also noted that while DeFi and on-chain CeFi lending data are visible on the blockchain and easily accessible, obtaining CeFi data is “difficult” due to inconsistencies in how CeFi lenders account for outstanding loans and how often they publish such information.

It is also worth noting that data from DefiLlama shows the total value locked (TVL) in DeFi lending protocols at roughly $90.9 billion as of early October.

Although TVL does not necessarily reflect the actual amount borrowed via these protocols, if the full $90 billion was indeed borrowed at the start of Q4, it may indicate that on-chain lending — together with CeFi — significantly exceeded Galaxy’s Q3 estimates.

As we wrote, Aave steadies around $175 amid cautious DeFi market sentiment

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