Web3 Needs a New Metric: Total Value unlocked (TVU)
For years, web3 has been measured by total Value Locked (TVL). This metric values ecosystems based on how much capital they can keep within their smart contracts. However, TVL has led to fragmentation, not freedom.
It’s time to shift the narrative. Web3 should focus on Total Value Unlocked (TVU). This metric measures how much value is made usable everywhere, not just locked away on isolated chains.
TVL has its flaws. It incentivizes protocols to hoard assets through staking rewards adn yield farming. This creates liquidity silos and fragmented networks. Developers are pressured to align with specific ecosystems, while users must navigate a complex landscape.
Recent trends, like the proliferation of Layer 2s, have worsened this problem. Projects like Base and Blast are expanding Ethereum’s reach but reinforcing value lock-in. Interoperability promises,like those made by cosmos and Polkadot,have yet to fully solve cross-chain composability at scale.
TVU shifts the focus from isolation to accessibility. It measures how much usable, verifiable, and interoperable value a blockchain ecosystem can unlock. this is what web3 urgently needs now: the ability to use the best applications, data, and liquidity, regardless of their origin.
To make this possible, the ecosystem needs a worldwide foundation for verifiability and interoperability. A settlement layer that validates data, transactions, and smart contracts across diverse environments.
TVU offers a new framework for growth, prioritizing composability, reach, and usability over isolated numbers. It rewards developers who build interoperable systems and guides ecosystem architects to design infrastructure that connects rather than isolates.
