2023’s top 5 DeFi protocols by revenue

TVL has begun to fall out of favor, so which metric can be used to rank this year’s top DeFi projects?


Phoenix Labs CEO and co-founder Sam MacPherson | DAS 2022 New York by Blockworks


Since DeFi Pulse popularized the metric in 2019, total value locked (TVL) has been used as a primary measure for a protocol’s success. 

But as DeFi slogged through a bear market for much of 2023, some pointed out that TVL can distort the underlying value of a protocol. Others said DeFi should abandon the metric altogether, saying it’s less meaningful than it’s purported to be.

“You bring ten whales and all of a sudden your TVL shoots through the roof,” Oleg Fomenko, co-founder of Sweat Economy, said. “We’re seeing a lot of projects fall into the same trap.”

A possible alternative metric could be revenue: the fees protocols collected minus the rewards they paid to liquidity providers (LPs). 

Read more: Is it time to drop TVL as a DeFi metric?

Revenue was measured with DeFiLlama data through Dec. 13. Notably, Uniswap Labs only began collecting revenue after instituting a fee on its interface in October. Blockworks Research estimates the Uniswap Labs to be on track for $17.7 million in annualized revenue so far. 

1. Maker — $95.91 million

Maker has gradually purchased US Treasury bonds since 2022, capturing yield from rising interest rates. Maker’s Spark Protocol subDAO, part of founder Rune Christensen’s so-called Endgame for Maker’s future, gave investors exposure to the T-bill yield through a locked version of its DAI stablecoin. The locked DAI’s yield reached as high as 8% this year. The savings DAI token sDAI has been put forward as an example of a real-world asset because it essentially tokenizes Treasury bonds.

2. Lido — $55.79 million

Lido capitalized on Ethereum’s move to proof-of-stake in 2022 by letting users stake their ether with the platform in exchange for its tokenized staked ether (stETH) that pays users staking rewards and can be traded or used as collateral. StETH grew to become the ninth-largest cryptocurrency with a market capitalization of over $20 billion. Lido most recently caught a boost from hype surrounding Ethereum’s forthcoming Dencun upgrade, initially slated for a 2023 release before being pushed back. Lido currently handles over 32% of all staked ether, sparking a debate about the liquid staking platform’s centralized position on the network. 

3. PancakeSwap — $52.31 million

PancakeSwap is the second-largest decentralized exchange (DEX) by volume behind Uniswap. The DEX launched v3 of its platform in March, focusing on concentrated liquidity, where LPs can concentrate their liquidity within specific ranges to enhance chances of their funds being used for a trade and earning fees. PancakeSwap has also tinkered with its governance model and launched a gaming marketplace. Originally native to the BNB Smart Chain, PancakeSwap remains the largest DeFi app on the chain. Nearly all of PancakeSwap’s volume comes from the BNB Smart Chain.

4. Convex Finance — $42.23 million

Convex is an asset management protocol that lets LPs and stakers lock up tokens issued by Curve and earn yield. Curve is the second-largest DEX on Ethereum behind Uniswap, and Convex’s fortunes are largely tied to Curve’s. Convex lets LPs and holders of Curve’s CRV token amplify yield from their tokens. Convex controls 48% of vote-escrowed Curve tokens and a third of vote-escrowed Frax tokens.

5. GMX — $37.52 million

GMX is a perpetual swap exchange. Perpetual swaps, or perps, let DeFi traders make highly leveraged trades without the need for large amounts of capital. Unlike traditional futures, perps don’t come with an expiration date when traders need to buy or sell an asset. GMX is the largest protocol by TVL on Arbitrum, and it was the largest recipient of the layer-2’s October grant allocation, bagging 12 million ARB, worth roughly $14 million at today’s prices.

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