Crypto Lending Falls 17% to $56 Billion: Is This Slide Healthier Than 2022?
Crypto-collateralized lending shrank by $11.33 billion during the second quarter of 2026, a 16.78% drop that left the market at $56.16 billion, according to Galaxy Research.
The contraction extended a third consecutive quarterly decline for crypto lending. Galaxy framed the slide as an orderly unwind rather than forced selling.
Every Crypto Lending Category Lost Ground
The market now sits 40.13% below its third-quarter 2025 peak of $78.69 billion. No segment escaped the pullback.
"Q2 was the first quarter since Q4 2022 in which onchain lending declined across every category (CeFi, DeFi, and the crypto-collateralized portion of collateral debt position stablecoins), as the market's deleveraging trend continued," Galaxy Research revealed.
Outstanding borrows on Decentralized Finance (DeFi) lending apps fell $7.79 billion, or 27.61%, to $20.43 billion. This was the steepest drop among the three legs.
Centralized finance (CeFi) open borrows contracted 9.62% to $22.98 billion. The reduction came mainly from Tether, whose market share slipped 371 basis points to 58.54%.
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