Global DeFi Market Faces Major Correction in Late September: Key Insights and Trends

The decentralized finance (DeFi) market experienced a significant downturn entering the fourth week of September, with market participants witnessing sharp declines across multiple protocols, chains, and sectors. According to data from DeFi analytics platform DefiLlama, the total value locked (TVL) in DeFi protocols dropped to $150.8 billion as of September 26, reflecting a 6% week-on-week decline from the prior $160 billion range. This correction is seen as a combination of short-term profit-taking and broader market volatility.

In contrast, the stablecoin market displayed relative resilience: its market capitalization rose 1.3% to $295.8 billion, with USDT maintaining a commanding 58.6% market share. This growth highlights a steady capital base despite DeFi market turbulence, underscoring a preference for stability during periods of uncertainty.

Declines Across Leading DeFi Protocols: Pendle Plummets, Ethena Outperforms

Top DeFi protocols faced widespread reductions in TVL last week, reflecting an industry under pressure. Aave, a leader in liquidity markets with $40.7 billion in assets, fell by 2.8%, while Lido Finance, a prominent liquid staking provider, saw a sharper decline of 8.6%, bringing its TVL to $35.1 billion. EigenLayer, a rapidly growing protocol focused on re-staking, experienced an even steeper drop of 11%, ending the week at $16.9 billion.

One of the week’s most striking declines came from Pendle. Once propelled to prominence by a surge in demand for synthetic stablecoins, Pendle’s TVL nosedived by 49% to $6.7 billion. This crash was attributed to liquidity withdrawal trends and adjustments in reward policies, raising questions about its long-term growth prospects.

However, not all protocols struggled. Ethena emerged as a rare outperformer, increasing its TVL by 2% to $14.4 billion, with a notable 17% rise over the past month. This resilience reflects the growing appeal of its unique offerings, positioning it as a standout in an otherwise challenging landscape.

Blockchain Networks Under Pressure: Ethereum, Solana, and Avalanche Decline

The weakness across DeFi protocols mirrored broader declines in blockchain network TVL. Ethereum, the dominant smart-contract platform, saw its TVL drop over 10% to $86.1 billion, reflecting its vulnerability to macroeconomic and technical challenges. Similarly, Solana and Avalanche registered double-digit losses, with TVL contracting by 12.9% to $11.1 billion and over 12% to $2 billion, respectively.

Bitcoin’s foray into DeFi suffered as well, with its TVL decreasing by 7% to $8.1 billion, while the Base chain dropped 6%, settling at $4.8 billion. Amid these declines, one emerging network made headlines: Plasma debuted in the upper tiers of TVL rankings with $3.4 billion. However, analysts raised concerns over possible data inconsistencies or anomalies tied to its rapid ascent, while noting rising interest in innovative Layer 2 solutions.

A Shake-Up in the Derivatives Market: Aster Challenges Hyperliquid

The derivatives sector underwent a dramatic shift last week, as trading volume surged 111% to $320.6 billion. Aster, a new decentralized exchange (DEX) operating on the BNB Chain, dominated this space with a remarkable 24-hour trading volume of $46.9 billion—dwarfing Hyperliquid’s $17.1 billion during the same timeframe. Aster’s open interest also soared, reaching $1.25 billion, absorbing significant short-term liquidity.

Describing the intensifying competition, industry publication CoinDesk labeled this as a “real-time territorial war.” While Hyperliquid still holds the upper hand in long-term metrics—boasting a 30-day cumulative trading volume of $292.4 billion compared to Aster’s $115.8 billion—the rapid rise of Aster has disrupted the balance of power. Analysts believe lower gas fees and stronger incentives on the BNB Chain could usher in a structural reallocation of trading activity toward Aster.

Aster Token ASTER Skyrockets by 40%: Investor Interest Surges

Adding to its momentum, Aster’s native token, ASTER, delivered an extraordinary 40% rally within 24 hours. This surge propelled its market capitalization to $3.4 billion, catapulting it into the top 50 cryptocurrencies globally. Its fully diluted valuation (FDV) exceeded $16.4 billion, reflecting elevated market expectations for the project’s long-term growth.

Industry experts suggest ASTER’s price activity and trading volume surge signal shifting investor confidence rather than isolated hype. Still, caution remains around the sustainability of Aster’s aggressive growth strategy, particularly regarding rewards policies and its ability to maintain liquidity inflows.

Weekly DeFi Market Snapshot: Key Trends and Takeaways

The DeFi market faced notable changes over the past week. Some of the most significant developments include:

• A 6% decline in overall TVL, bringing the total to $150.8 billion
• Broad weakness across major chains and protocols, with Pendle’s TVL plummeting 49% but Ethena showing resilience
• Ethereum, Solana, and Avalanche suffering double-digit TVL contractions
• Aster reshaping the derivatives landscape by overshadowing Hyperliquid in daily trading volumes
• ASTER token’s explosive growth, marking a 40% rally supported by investor enthusiasm

“Spot-to-derivatives trading transitions are accelerating,” remarked one industry insider. “While Aster has posed a credible challenge to Hyperliquid in the short-term, the long-term battle will hinge on fee structures, liquidity incentives, and platform reliability.”

As the DeFi market navigates these turbulent times, the interplay between innovation, liquidity dynamics, and trader sentiment will likely determine the ecosystem's future trajectory. While challenges persist, the ongoing evolution in derivatives and blockchain network technology provides potential pathways for renewed growth.