Total Value Locked (TVL)

Total value locked, or TVL, sums the value of assets that users have deposited into a protocol's smart contracts. For a lending protocol it is the total collateral and deposits. For a DEX it is the total liquidity in its pools. For a liquid staking service it is the value of staked coins. TVL can also be totaled across an entire blockchain to compare ecosystems.

TVL is widely used as a rough measure of how much trust and capital a protocol has attracted. A protocol with 10 billion dollars of TVL is handling far more economic activity than one with 10 million dollars. Sites such as DefiLlama track TVL across thousands of protocols and chains.

TVL has quirks. Because it is measured in dollars, it rises and falls with crypto prices even if no deposits change. It can be inflated by counting the same assets twice when one protocol builds on another. And high TVL does not prove a protocol is safe, since several protocols with billions locked have been exploited.