Layer by Layer: Ethereum Remains Dominant Amidst Major Impacts to DeFi Ecosystem

Nearly three months have passed since the Ethereum network underwent the most significant upgrade in its history by transitioning from proof-of-work (PoW) to proof-of-stake (PoS) consensus in the Merge. During this time, the broader crypto ecosystem has been ravaged by the fallout from the FTX and Alameda collapse. Previously, we looked at the contrasting impacts of the incident on the BNB Chain and Solana ecosystems, both of whose affiliations with the founders of Binance and FTX, respectively, seem to have played a contributing role in recent capital flows. On Ethereum, which remains the largest decentralized finance (DeFi) ecosystem by total value locked (TVL), the impacts have been measurable as well. 

Since the beginning of the year, TVL in the Ethereum ecosystem has fallen by ~$70.4 billion for a loss of ~69% as of this writing. These losses have generally tracked the price of ETH, which has fallen by ~67% over the same period.