The resurgence of DeFi season is capturing the attention of cryptocurrency traders worldwide, as highlighted by crypto analyst Miles Deutscher in his recent tweet on August 12, 2025. He enthusiastically declared that DeFi szn is back, with Total Value Locked (TVL) in DeFi protocols approaching the highs seen in 2021. This development signals a potential shift in market dynamics, offering traders fresh opportunities in decentralized finance tokens and related assets. As TVL climbs, it reflects growing investor confidence and capital inflows into DeFi ecosystems, which could drive price action across major cryptocurrencies like ETH and emerging DeFi projects.

Analyzing DeFi TVL Surge and Trading Implications

Diving deeper into the metrics, the Total Value Locked in DeFi has been on a remarkable uptrend, nearing the peak levels from the 2021 bull run when TVL surpassed $180 billion according to data from DeFi Llama. This resurgence comes amid broader market recovery, with Ethereum, the backbone of most DeFi protocols, showing strength in its price movements. Traders should monitor key support levels for ETH around $3,000 and resistance at $4,000, as a breakout could amplify DeFi token rallies. For instance, tokens like UNI (Uniswap) and AAVE have seen 24-hour trading volumes spike by over 20% in recent sessions, correlating directly with TVL growth. This indicates heightened liquidity and potential for short-term trades, especially in pairs like UNI/USDT on exchanges such as Binance.

From a trading perspective, the return of DeFi season presents both opportunities and risks. Historical patterns from 2021 show that TVL peaks often precede major price pumps in altcoins, but they can also lead to corrections if over-leveraged positions unwind. Current on-chain metrics, including increased transaction counts on Ethereum layer-2 solutions like Optimism and Arbitrum, suggest sustainable growth. Traders might consider strategies such as longing DeFi blue-chips during dips, with stop-losses set below recent lows. Additionally, cross-market correlations are evident; for example, Bitcoin's stability above $60,000 provides a supportive backdrop for DeFi expansion, as BTC dominance dips below 50%, allowing altcoins to shine.

Key DeFi Tokens to Watch for Trading Setups

Specific DeFi tokens are poised for volatility amid this TVL revival. Take COMP (Compound) and MKR (MakerDAO), which have exhibited bullish patterns with trading volumes exceeding $100 million daily as of mid-August 2025. Price analysis reveals COMP testing resistance at $50, with a potential target of $70 if TVL momentum sustains. Similarly, MKR's on-chain governance activity has surged, driving its price toward $2,500. Traders can look for entry points on pullbacks, using indicators like RSI above 60 to confirm upward momentum. Institutional flows, evidenced by increased whale accumulations reported in blockchain analytics, further bolster the case for DeFi trades.

In summary, the DeFi resurgence as noted by Miles Deutscher underscores a pivotal moment for crypto markets. With TVL nearing 2021 highs, traders should focus on high-conviction setups in ETH-based pairs, monitoring trading volumes and market sentiment for optimal entries. This could mark the beginning of a broader altcoin season, intertwined with Bitcoin's performance, offering diversified trading strategies for both spot and derivatives markets.