Immy Dorse 
Well, it looks like people were feeling a bit more confident with their crypto this past spring. Or maybe they just needed some cash. Either way, new numbers from Galaxy Research show borrowing against digital assets shot up pretty dramatically in the second quarter.
The total value of loans taken out using crypto as collateral hit a new record. We’re talking about $44.25 billion by the end of June. That’s a huge jump from the quarter before.
DeFi Leads the Surge
A lot of that action happened on decentralized platforms, the so-called DeFi protocols. Loans there climbed to over $26 billion. That’s a 42% increase in just three months. It’s one of the biggest surges we’ve seen since the last major bull market a few years back.
It’s not too hard to figure out why. Crypto prices have been up, with Bitcoin and Ethereum breaking old records. When prices go up, people who own these assets are often less willing to sell. So instead, they use them as collateral to get a loan. It lets them access money without actually letting go of their holdings. Seems straightforward enough.
Tether’s Still on Top in Centralized Lending
Over on the more traditional, centralized side of things—the CeFi platforms—the story is a bit different. The total there is smaller, sitting at $17.78 billion. But it’s still growing at a solid clip, up almost 15% from the first quarter.
And one name just keeps popping up: Tether. The stablecoin company is absolutely dominating this space. They closed the quarter with over $10 billion in open loans. That gives them more than half of the entire CeFi lending market. It’s their twelfth quarter in a row as the top player.
Their main competitors, like Nexo and Galaxy’s own lending unit, are far behind. The top three firms together control nearly three-quarters of all centralized crypto lending.
How Did We Get Here?
Tether’s position today is, in a way, a product of the past. Remember all those lending platforms that blew up back in 2022? Genesis, Celsius, Voyager… the list goes on. When they collapsed, it created a massive vacuum. Tether quietly stepped in and its market share exploded from under 20% to nearly 70% in a pretty short time.
That grip has loosened just a little since then. The report suggests a few reasons. Rising crypto prices naturally make people want to borrow more. Also, companies are now looking at these lenders as a real source for funding. And with more competition lately, the rates to borrow have gotten better for everyone.
So yeah, the landscape is shifting, bit by bit. But for now, Tether is still the name everyone’s chasing.