The total value of ETH locked by DeFi dapps in USD terms is up 28% in the last three days, a boon for traders who witnessed one of the largest single day fall of Ethereum on Mar 12, 2020.

Ethereum is the leading platform for decentralized finance or open finance applications.

Its decentralized nature and smart contracting capacity means that the network is perfect for coin holders to earn interest or borrow loans from their digital asset stash.

There are several DeFi applications, and after the fall of mid-March, the amount of ETH locked is now up to $623 million up from $487 million of Mar 23.

ETH is the collateral for all the CDPs released by Ethereum-based DeFi lending and loaning apps.

Because of the volatile nature of ETH, a digital asset open to market forces and autonomous like Bitcoin, creators prefer their loans in DAI to be over-collaterized. The current ratio is 150%.

The rise in the total value of ETH held by DeFi dapps is a mark of confidence and a leading indicator of a correction. As observed, there seems to be a positive correlation between the locked value and the price of ETH.

The Total Value Locked (TVL) peaked on Feb 15 when $1.23 billion in ETH were cumulatively held by DeFi apps.

Coincidentally, this the time when ETH peaked. On Feb 15, ETH prices reached $277 before falling in subsequent sessions.

However, the TVL of DeFi apps fell immediately and by Feb 19 when ETH retested $277, the amount locked stood at $1.20.

At the moment, ETH is consolidating at $135, $15 shy off the main resistance at $150. Meanwhile, TVL is bottoming up, up 28% in three days.

If history guides and price action are anything to go by, ETH will likely edge higher.

Meanwhile, MakerDAO remains the most dominant application despite heavy losses on Mar 12-13 when Ethereum was temporarily clogged.

The slow network means that the collateral auction couldn’t function as coded and there are individuals who placed zero bids.

This was recouped when the foundation minted extra MKR tokens to compensate victims.