TVL, short for Total Value Locked, is defined as the total value of encrypted assets locked in smart contracts. It is a metric commonly used to measure the development status of individual or certain types of DeFi protocols, usually denominated in US dollars.
Typically, the services of DeFi protocols are based on encrypted assets locked in the platform's smart contracts. TVL can to some extent reflect the liquidity situation of DeFi protocols, with higher TVL generally indicating a better user experience. Additionally, the liquidity locked in the smart contracts of DeFi protocols is usually provided by users, so TVL can also to some extent reflect the active user base of DeFi protocols, with higher TVL generally indicating a larger active user community.