What Is TVL in Crypto? Meaning, DeFi Role and Blockchain Rankings

Cryptocurrencies continue to gain popularity, and with them, the number of new terms needed to understand what is happening in the world of digital money is also growing. One of the most important of these is TVL (Total Value Locked). This metric is widely used in the decentralised finance (DeFi) industry and serves as a benchmark for evaluating projects and making investment decisions.

In this article, we will explore what TVL means in crypto, what role it plays in the DeFi space, and how it affects user and investor confidence in various platforms. We will also discuss the factors influencing TVL growth, how to calculate the indicator, and show why it is important for calculating asset attractiveness.

TVL Meaning in Crypto and DeFi

Total Value Locked (TVL) is an indicator that reflects the total amount of assets locked within specific smart contracts and decentralised applications. Simply put, TVL crypto shows how much money is inside the system and ensures its functioning.

TVL DeFi serves as a key parameter for assessing the popularity and reliability of a decentralised financial protocol. The higher the TVL indicator, the more confidence investors and market participants have in the project. This is due to several factors:

• Growth in liquidity. A high TVL indicates that there are sufficient assets available for trading, lending, and providing services.
• Attractiveness to investors. Large amounts of locked funds increase confidence in the stability and security of the project.
• Ecosystem support. High TVL contributes to the development of infrastructure around the protocol, attracting developers and users.

However, it is important to remember that TVL alone does not guarantee the success of a project and should be considered alongside other indicators, such as the security and efficiency of smart contracts.

How Blockchain TVL Is Calculated

Blockchain TVL is calculated by multiplying the total amount of assets locked in the protocol by their current market price and then summing all the indicators. For convenience, the total amount of locked funds is displayed in US dollars. Below is an example of TVL calculation for three assets: USDT, ETH, and TRX.

 

Let's calculate the amount of locked funds for each asset:

• ETH: 5,000 x 4,328 = 21,640,000;
• USDT: 500,000 x 1 = 500,000;
• TRX: 100,000 x 0.3371 = 33,710.

Now let's add up the values: 21,640,000 + 500,000 + 33,710 = 22,173,710. In our example, TVL is $22,173,710.

When conducting cross-chain crypto analytics, it is important to consider not only TVL but also market capitalisation. Although both indicators show the value of a cryptocurrency, they convey different information:

• TVL reflects the real money working in the protocol. In calculations, all locked assets are multiplied by their value and added together. This gives an idea of the amount of money actually working in the system. The indicator is influenced by changes in cryptocurrency rates, new deposits, and withdrawals by participants. The main advantages are that it assesses the real activity of the project and helps to identify projects with a high level of participation and liquidity. The main disadvantages are that it does not reflect the financial benefit of the protocol itself and only changes when funds are moved and the value of assets changes.
• Market capitalisation is the market's assessment of the value of a project. It is calculated by multiplying the number of tokens in circulation by their current price. This allows the market's perceived value of the project to be determined. The indicator is influenced by fluctuations in the value of tokens and changes in supply and demand. The main advantages are that it is easy to calculate and interpret, and it gives an idea of the size and dominance of the project in the market. The main disadvantages are that it does not show real activity in the protocol and is highly sensitive to speculation and artificial price inflation.

The table below compares the key differences between TVL and total capitalisation.

 

It is important to understand that high market capitalisation figures may not correspond to the actual usefulness of the protocol if most tokens are rarely used or stored outside the network. This is precisely why it is important to know the TVL crypto ranking.

TVL Rankings and Crypto Lists

One of the most important ways to assess the popularity and success of blockchain projects is through rankings based on the total amount of locked funds. Such lists are compiled by specialised data aggregators, among which the following stand out:

• DefiLlama – provides detailed TVL statistics for a variety of DeFi protocols and blockchains, as well as access to the top TVL crypto list.
• CoinGecko – publishes blockchain rankings by TVL, allowing you to compare platforms by the amount of funds raised.
• TradingView – generates lists of cryptocurrencies with the highest TVL indicators, taking into account market dynamics and activity.

The TVL rating process involves several stages. First, aggregators collect information about the funds locked in the smart contracts of each protocol. Next, they are recalculated into a single unit of change. Currencies are converted into a standard measure (usually USD) for ease of comparison. The final indicator is formed by summing up all the assets of each protocol. The results are ranked in descending order of TVL, forming the final table.

Top 3 projects by TVL (as of September 2025):

• Ethereum – $90 billion;
• Solana – $12.24 billion;
• Bitcoin – $7.94 billion.

Such ratings help investors choose reliable and active projects by assessing the level of user trust and the scale of platform liquidity.

It is important to note that TVL reflects not only the reliability of the project, but also the quality of smart contract implementation and support infrastructure. Consequently, such ratings serve as an important source of information for making informed investment decisions.

TVL rankings provide valuable data for analysing and selecting promising blockchain projects, but require additional consideration of the market context and technical features of each protocol.

Cross-Chain Analytics and TVL

In 2025, the popularity of cross-chain solutions continues to grow. Technologies such as LayerZero, Wormhole, and Axelar facilitate the movement of funds between different blockchains. This creates a new reality for TVL analysis, as funds are no longer concentrated in individual systems. Many analytical tools have not yet had time to adapt to this change.

Comparing TVL across different blockchains:

• Ethereum remains the largest player with approximately $90 billion in TVL;
• Solana is actively developing interoperable infrastructure, with a TVL of around $12.2 billion;
• TRON is also strengthening its position with a TVL of around $6 billion.

Despite a significant increase in TVL due to cross-chain activity, traditional approaches to data analysis do not always reflect the full picture of user interaction with different systems.

Cross-chain analytics allows you to explore the movement of funds and liquidity between blockchains, opening up opportunities for investors and developers:

• strategy optimisation – understanding where funds are migrating helps to build effective investment portfolios;
• improved capital efficiency – users can respond quickly to liquidity movement trends;
• Infrastructure development – knowledge of migration flows helps create improved solutions for interaction between blockchains.

In the future, further expansion of blockchain integration is expected, making cross-chain analytics a critical component of cryptocurrency market monitoring.

Why TVL Matters for Investors and Bettors

Understanding the significance of Total Value Locked is critical for anyone involved in the cryptocurrency space, especially investors and gamblers. TVL shows the total value of funds locked in blockchain smart contracts. Here's why this metric is so important

Trust in the protocol

A high TVL often indicates a high level of user trust in a given protocol. People are willing to invest significant amounts, thereby confirming the reliability and security of the platform. For example, a high TVL on a gaming platform means that players are confident in the fairness of the game and the timeliness of payouts.

Liquidity for betting and gaming

In the context of gambling, sufficient liquidity ensures smooth transactions. Players expect fast payouts and uninterrupted system operation. A high TVL guarantees sufficient funds to process large bets and instant withdrawals, reducing the risk of payment delays.

Risk analysis

Investors closely monitor changes in TVL to assess potential risks. A sharp decline in the indicator may indicate problems such as hacking or insufficient asset protection. Conversely, steady growth in TVL highlights the stability and long-term viability of the project.

TVL meaning strand allows market participants to make informed choices and balanced decisions.

Conclusion

Total Value Locked (TVL) is a key indicator of the health and attractiveness of decentralised finance projects. It reflects the total amount of funds locked in the protocol, which characterises the level of user confidence and liquidity availability.

Although TVL is useful for assessing a project's prospects and security, it should be considered in conjunction with other factors such as security, functional simplicity, and market dynamics. By understanding what TVL is, investors and analysts can more effectively evaluate the market and find the most interesting investment opportunities in the rapidly evolving cryptocurrency space.