Cardano Liquid Staking Challenges TVL Metric Relevance

TVL excludes liquid staking providing an unrepresentative measure of the Cardano ecosystem.

Little boy emerging from water, holding up a big jar of golden coins.
Created by Gabor Kovacs from DailyCoin
  • Total value locked (TVL) is slated as an outdated metric.
  • Liquid staking is not recorded in TVL
  • Cardano DeFi is booming.

With the explosive growth of decentralized finance (DeFi), the total value locked (TVL) metric has become the standard for measuring adoption and comparing network valuations. TVL tallies the assets deposited into DeFi protocols, providing a sense of the overall capital invested and market size. However, TVL has come under fire recently as a poor representation of the burgeoning Cardano DeFi ecosystem. 

While Cardano boasts over ₳23 billion staked (just under $7 billion at the current price), representing 66% of the total supply staked, data aggregators such as DeFi Llama do not include liquid staked tokens in TVL calculations. This omission places Cardano far lower in TVL rankings, sparking calls for an alternative standard from community members.

Total Value Liquid

DeFi Llama’s policy excludes liquid staked tokens from TVL valuations across all chains, not just Cardano. However, this policy penalizes innovative liquid staking models like Cardano’s, where staked ADA earning yield can be traded without any lock-in period or penalty.


Cardano stake pool operator (SPO) “Stake With Pride” argued that DeFi Llama’s policy approach does not consider the growing liquid staking sector, particularly as the trend is towards chains moving away from traditional illiquid staking models. This policy would likely relegate the TVL metric into obscurity, stated Stake With Pride.

Further discussions led Stake With Pride to conclude that locking tokens is a somewhat dated practice. Stake With Pride suggested incorporating liquid staked tokens in a new metric of “total value liquid” would better capture user activity and capital invested into specific blockchains as the DeFi sector evolves.


All the same, TVL remains the dominant DeFi valuation metric, and Cardano’s TVL continues to climb higher in the rankings. 

Cardano DeFi Is Booming

Cardano has climbed to 13th place in DeFi Llama’s TVL rankings, with just over $203 million locked as of October 30th. Although Cardano’s TVL is significantly below major rivals, including Ethereum and Tron, at $22.6 billion and $7.8 billion, respectively, Cardano’s TVL has been trending upward since November 2022, reaching a new all-time of 689 million ADA today.

Cardano TVL in ADA per DeFi Llama

During Cardano’s TVL uptrend, the TVL in most blockchains has been decreasing, with Ethereum particularly affected, falling to 12.7 million ETH currently from around 22 million ETH in November 2022.

On the Flipside

  • Liquid staking has been a key innovation for Cardano.
  • Cardano’s TVL growth has exceeded expectations this year as developers continue building its DeFi ecosystem.
  • Due to the nature of DeFi services, TVL can count funds more than once, leading to overstated figures.

Why This Matters

As DeFi makes greater inroads into finance, metrics like TVL shape perceptions and impact development. Updating TVL to more accurately reflect valuations aids credibility and ensures commonly used metrics keep pace with innovation in a fast-moving industry.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Samuel Wan

Samuel Wan is a finance professional turned crypto journalist, known for his insightful reporting on market trends, regulatory changes, and technological developments within the digital asset industry. His ability to simplify complex concepts and report the facts has made him a trusted source in the crypto community. Beyond his writing, Samuel is an active mountain biker and gamer.