The total crypto lending market has decreased by 43% from its peak in 2021, now standing at $36.5 billion as of Q4 2024. Despite this overall decline, decentralized finance (DeFi) has experienced significant growth, with borrowing increasing by 959% since the market's low in 2022, reaching $19.1 billion across 20 protocols and 12 blockchains. Tether, Galaxy, and Ledn dominate the centralized finance (CeFi) lending sector, collectively holding nearly 90% of the outstanding loans amounting to $11.2 billion. CeFi loans have dropped by 68% from their high in early 2022. The report highlights a trend towards decentralized lending systems which are becoming more prominent, allowing users to borrow crypto without centralized intermediaries. Looking forward, analysts expect the cryptocurrency lending market to see a new phase of growth, driven by risk management improvements, increased institutional participation, and clearer regulatory guidelines, potentially bridging traditional finance and the digital asset ecosystem.

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