The DeFi market, which operates outside of Bitcoin, has been a highly exciting and unstable sector in the cryptocurrency space. In 2020, it experienced a bullish market, with the total value locked (TVL) in DeFi protocols surging from $1 billion to over $100 billion. However, the DeFi market is prone to significant corrections, as seen in 2021 when the TVL dropped from $100 billion to $40 billion. To gauge the health of the DeFi sector, traders can focus on three key metrics: TVL, a platform's fee revenue, and the number of non-zero wallets holding tokens. Increases in the TVL indicate growing demand and a potential bull market. Similarly, rising protocol fees and the number of non-zero addresses signal increased usage and interest in DeFi. By monitoring these metrics, traders can gain insights into the overall health of the DeFi market and potentially identify emerging bull markets. However, it is important to consider on-chain metrics and other macro factors alongside these metrics due to the market's volatility. This article does not provide investment advice. Read more AI-generated news on: https://app.chaingpt.org/news