Borrowing activity in crypto markets accelerated sharply in the second quarter of 2025, according to new figures from Galaxy Research.

The study found that loans backed by digital assets across DeFi protocols climbed to a record $26.47 billion, up 42.1% from the previous quarter.

That surge lifted the overall balance of crypto-collateralized loans, including both DeFi and centralized finance (CeFi) platforms, to $44.25 billion at the end of June.

The increase of $10.12 billion quarter-over-quarter represents one of the largest jumps since the bull market years of late 2021 and early 2022, when outstanding loans briefly topped $50 billion.

The report linked the recovery to a combination of rising crypto prices and stronger demand for leverage.

Traders often use crypto lending to secure cash without selling their holdings, and with Bitcoin and Ethereum recently breaking past previous all-time highs, more participants appear willing to lock up assets to capture liquidity.

Tether dominates CeFi lending

Galaxy Research reported that as of June 30, open CeFi loa

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Author: Oluwapelumi Adejumo

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