Crypto leverage surges to a new high in Q3 amid expanding DeFi markets

Galaxy Research found that on-chain lending led to crypto-collateralized debt hitting a record $73.6 billion in the third quarter. The surge marked an all-time high in crypto-collateralized borrowing, but the market’s leverage is now better collateralized than during the 2021-2022 cycle. The analytics firm revealed that the surge was mainly driven by on-chain lending, which now accounts for about 66.9% of all crypto-collateralized debt. On-chain borrowing has surged from 48.6% at the previous peak four years ago, driven by collateralized debt positions (CDPs), stablecoins such as DAI, and lending applications. Borrowers abandon uncollateralized lending and shift to full-collateral models Data from Galaxy Research also showed that DeFi lending alone increased by 55% to an all-time high of $41 billion. According to the analytics firm, the surge was supported by points-driven user incentives and improved collateral types such as Pendle Principal Tokens. Centralized lending also grew by 37% to $24.4 billion....

https://www.cryptopolitan.com/crypto-leverage-soarsrecord-high/