Ethereum TVL skyrocketed by over $20 billion in July 2025, hitting a year-high of $86 billion on July 28. This remarkable growth shows Ethereum’s dominance in decentralised finance (DeFi).
So, what fuelled this surge? Let us examine the key drivers behind Ethereum TVL’s explosive rise.
Institutional Inflows Boost Ethereum TVL
First and foremost, spot Ethereum exchange-traded funds (ETFs) sparked massive institutional interest. These ETFs attracted $2.39 billion in inflows over six days in July. BlackRock’s iShares Ethereum Trust surged to $1.79 billion in inflows, hitting a $10 billion asset milestone. This influx constricted ETH supply, driving a substantial increase in Ethereum’s Total Value Locked (TVL).
Moreover, large investors, or “whales,” accumulated 1.13 million ETH, worth $4.18 billion, in two weeks. This bold purchasing spree showcased robust optimism, significantly propelling Ethereum’s Total Value Locked (TVL) upward.
Technological Upgrades Enhance Scalability
Additionally, Ethereum’s technological advancements played a crucial role. The Dencun upgrade slashed Layer-2 transaction fees, making DeFi more accessible. Meanwhile, the upcoming Pectra upgrade promises enhanced staking efficiency.
The upgrade enables validators to stake as much as 2,048 ETH, a leap from the previous 32 ETH limit. These enhancements fortified Ethereum’s network security and drew substantial capital, boosting its TVL.
Furthermore, layer-2 solutions like Arbitrum and Optimism saw increased adoption, contributing to the TVL spike.
DeFi and NFT Growth Drive Engagement
Importantly, DeFi and non-fungible token (NFT) ecosystems thrived on Ethereum. DeFi protocols held $87 billion, or 65% of the total DeFi TVL.
Lending, liquid staking, and restaking protocols drew significant capital. For instance, EigenLayer’s restaking feature added $940 million on July 21. At the same time, NFT sales skyrocketed by 175%, reaching $275.6 million over a 30-day period.
This vibrant activity reinforced Ethereum’s role as a DeFi powerhouse, pushing Ethereum TVL higher.
Network Adoption and Developer Activity
Besides, Ethereum’s network growth fuelled the TVL increase. Approximately 3 million new wallet addresses emerged in July, reflecting widespread adoption.
Additionally, 7,864 active developers worked on 113,103 repositories, driving innovation. These metrics highlight Ethereum’s robust ecosystem, which supports Ethereum TVL’s upward trajectory.
Furthermore, staking reached 34.65 million ETH, or 28.7% of the total supply, locking more assets into the network.
Market Sentiment and Future Outlook Contributed to Ethereum TVL
Finally, bullish market sentiment amplified Ethereum TVL’s growth. Analysts predict ETH prices could hit $15,000 by 2030, driven by ETF inflows and upgrades.
However, macroeconomic factors like interest rates may influence future gains. Despite challenges, Ethereum’s robustness and flexibility solidify its dominance in DeFi.
As Ethereum TVL continues climbing, it solidifies Ethereum’s position as the backbone of decentralised finance.
In conclusion, Ethereum TVL’s $20 billion surge in July 2025 stemmed from institutional inflows, technological upgrades, DeFi and NFT growth, and robust network adoption.
These dynamics together drove Ethereum’s Total Value Locked (TVL) to a yearly peak of $86 billion. Moving forward, Ethereum’s ongoing innovation and strong market trust signal continued expansion in its DeFi ecosystem.
Written by Raphael Minter
More money in Ethereum DeFi means more opportunities for yield farming and lending, so I am in. TVL rising means more activity on Ethereum. Good news for users and devs building on the chain.
$20B TVL increase in a month is significant. Need to watch if this momentum holds amid market fluctuations. Ethereum’s scaling solutions like L2s might be driving this TVL surge. Interesting to monitor further developments.
Ethereum’s on fire. $20 Billion TVL surge is a huge vote of confidence in the ecosystem. This surge shows Eth’s dominance in DeFi is still strong. Cannot wait for more dApp innovation.