FoundationsBeginner5 min
Understanding TVL
Core question
Does high TVL mean a protocol is safe?
TVL (Total Value Locked) is the total capital currently held in a pool or protocol. A high TVL (e.g. over $100M) often signals scale and liquidity — but it isn't proof of safety or a substitute for an audit. A low TVL combined with an extreme APY is usually a warning sign worth a closer look.
Look up in the Glossary: TVL →What TVL shows – and what it doesn't
- Lots of capital, ordinary yieldA high TVL means many have deposited here and there is liquidity. It says nothing about whether the code is safe.
- Little capital, extreme yieldA small pool with a yield far above the usual: worth a closer look – where does the yield come from, and how long will it last?
Schema, not market data. A high TVL is no proof of safety and no substitute for an audit.