Analysis: Fed rate cuts, China’s credit expansion and DeFi infrastructure improvements may drive DeFi’s second round of growth

According to BlockBeats, on October 1, investment management company Apollo Crypto released a report highlighting the potential for a second round of growth in decentralized finance (DeFi), identifying macroeconomic factors such as the Fed's recent interest rate cuts and China's credit expansion as key drivers of DeFi growth.

The report pointed out that after the peak of the "Summer of DeFi" in 2020, the market slowed down. However, protocols such as Maker, Uniswap and Aave have become mainstream in the industry. As of now, the total TVL of DeFi is about US$105 billion.

The report also mentioned decentralized finance (DeFi) infrastructure, saying that "the past few years have focused on building cryptocurrency infrastructure" to build "a lot of cheap block space." This allows DApps to access block space at "higher performance speeds" and reduces transaction costs on L2 expansion solutions.