The crypto-collateralized lending market shed another $11.33 billion in Q2 2026, bringing total outstanding loans to $56.16 billion, a 16.78% quarterly decline and a 40.13% drop from the peak of $78.69 billion reached in Q3 2025. Decentralized finance took the bigger hit with a 27.61% drop to $20.43 billion, while centralized finance fell just 9.62% to $22.98 billion, allowing CeFi to overtake DeFi for the first time since Q3 2023. Galaxy noted this contraction is voluntary and orderly, unlike the forced liquidations that triggered the 2022 crash. Early July data however shows recovery signs with DeFi borrowing rebounding to approximately $21.94 billion and futures open interest climbing back to $114 billion.
Source: Read the original article
