TVL, full name Total Value Locked, literally translated as total value locked, is defined as the encryption locked in the smart contract The total asset value is an indicator usually used to measure the development status of a single or a certain type of DeFi protocol, and is generally measured in US dollars.
What is a smart contract? What is DeFi? Please refer to the "What is a Smart Contract" and "What is DeFi" chapters.
Usually, the services of the DeFi protocol are based on the encrypted assets locked in the smart contract of the platform. TVL can reflect the liquidity of the DeFi protocol to a certain extent. A higher TVL generally represents a higher Good experience. For example: the higher the liquidity of the LP pool in AMM DEX, the lower the slippage losses suffered by users when trading.
What is DEX? What is an LP? Please refer to the "What is DEX" and "What is Liquidity and LP Pools" chapters.
At the same time, the liquidity locked in the smart contract of the DeFi protocol is usually provided by users, so TVL can also reflect the active users of the DeFi protocol to a certain extent. A higher TVL generally represents A larger active user base.
Commonly used TVL data query website: DeFiLlama