Total Locked Assets (TVL)
In short: Total locked assets (TVL, short for total value locked) is the sum of the assets staked or deposited within a protocol, usually expressed in US dollars.
Total locked assets (TVL, short for total value locked) is the sum of the assets staked or deposited within a protocol, usually expressed in US dollars. It can be measured for a single application or for a whole blockchain.
Why it matters
TVL is one of the most quoted measures of how much capital a DeFi protocol or a blockchain attracts, and analytics sites often rank projects by it. It has limits, though: because it is priced in dollars, TVL moves with token prices even when nobody deposits or withdraws. The same assets can also be counted more than once, for example when tokens received for a deposit in one protocol are deposited again in another. A high TVL does not show whether a protocol is profitable or safe.
Example
A lending protocol holds ETH and stablecoins deposited by its users. If the market price of ETH halves while deposits stay the same, the ETH part of the protocol's TVL also halves, even though nobody withdrew anything. The stablecoin part barely changes. Comparing deposits in token units, not only in dollars, gives a clearer picture of real activity.