Navigating Toward Product-Market Fit

The MINTY listing is a long-awaited milestone for our community, and we understand the eagerness to see it happen even as we make hard choices to secure our long-term success for all of us.

Over the past few months, our team has worked diligently refining our product, expanding the chains we support, and partnering with launch collaborators to build momentum for this milestone. But a closer look at the DeFi landscape shows major changes impacting all lending protocols, including us, so we’re rethinking our strategy and timing for the listing.

Rushing into a listing could weaken our community, risking lower interest and growth that might set us back. Instead, we’re focusing on finding the right fit for our product, driving growth, and building adoption to ensure a strong launch we can all celebrate. These changes also spark exciting opportunities for innovation, and we’re diving in to explore them.

In this post, we’ll walk you through the market shifts pushing us to take this new path, focusing on today’s Web3 challenges to keep Minterest thriving for the long haul.

1. Market Challenges & Shifting Liquidity Trends

1.1 TVL is Consolidating: Aave’s Dominance and Compound’s Pivot
Total Value Locked (TVL), or the total value of assets in a DeFi protocol, is concentrating in fewer platforms, with Aave’s rapid growth from H2 2024 now holding nearly $30B in TVL, approximately 50% of all lending TVL.

Fig. 1.1.1 – Aave TVL growth since H2 2024 shows dominance (Source for all charts: DeFiLlama)

Compound Finance is shifting away from expanding Compound V3 for multichain deployment and is instead collaborating with Morpho to enable this functionality, as announced by Compound’s Head of Growth, Bryan Colligan, on March 9, 2025. This pivot reflects a broader shift in dominance, with Compound’s borrow levels falling below Morpho’s for the first time in February 2024, showing just how fierce the competition is in DeFi lending, and we’re navigating this with you in mind.

Fig. 1.1.2 – Morpho has overtaken Compound TVL since Q4 2024

This trend is further evidenced by significant TVL declines among other quality projects, such as LayerBank (a 95% drop from $800M to $40M) and ZeroLend (a 85% drop from $850M to $130M), a pattern Minterest is also experiencing.

Fig. 1.1.3 – TVL across prominent Lending Protocols has declined significantly since Q4 2024

This concentration of liquidity in a few dominant players shows how capital is increasingly flowing to larger protocols, leaving the vast majority of protocols needing to find new ways to attract and retain users.

Note: the selection of protocols used is an illustration of a broad trend, and is non-exhaustive, as there are lending protocols, in this category, that may be outperforming.

1.2 The Lending Market Competition has Exploded without new Liquidity
The number of lending protocols has risen from 50 to over 500 since March 2023, a 10-fold increase while TVL in DeFi has not increased beyond 2021 levels, intensifying the need for differentiation to stay competitive.

Fig. 1.2.1 TVL in DeFi has not grown in 3 years since Q4 2021

However, with over 500 protocols now competing for the same limited liquidity, the DeFi lending market has become overcrowded, making it increasingly difficult for projects to secure capital.

Historically, projects incentivised liquidity through high token emissions to drive user onboarding and growth. However, the market has shifted. Many now rely on unsustainable deals with private liquidity providers, promising returns of 40-60%+ to attract temporary capital, a model that no longer fosters long-term liquidity, prompting us to explore more sustainable alternatives.

1.3 Liquidity Distribution Across Chains Is Uneven

Liquidity distribution across more than 350 Layer 1 and Layer 2 networks remains uneven and fragmented, with significant capital concentrating on a few dominant chains like Base, Arbitrum, Tron, BNB Chain, and Solana, outside of Ethereum.

Fig. 1.3.1 TVL is fragmented across several chains (Source: DeFiLlama)

As a result, accessing liquidity and sustaining revenue for lending protocols now requires focusing on the Top 10 chains to support ongoing growth and development.

2. Finding Product-Market Fit for Sustainable Growth

Minterest isn’t just another protocol; it stands out with its unique Solvency Engine that ensures smarter, fairer liquidations compared to any other lending protocol, along with the MINTY token design, which drives long-term value. With the right TVL, Minterest can become a major force.

Our team is taking a data-driven approach to product-market fit (PMF), focusing on long-term adoption rather than short-term incentives. Our goal is to identify and develop sustainable models where protocol fees support ongoing development, benefiting both the team and the community. As DeFi evolves, new trends are shaping the lending landscape, and we are actively exploring key areas that could define Minterest’s growth strategy.

2.1 Stablecoins: A Growing Opportunity in DeFi Lending

Stablecoins have emerged as the dominant product-market fit in blockchain, with over 30 million active wallets, doubling since March 2023. Over the same period, the stablecoin market cap has surpassed $200 billion, demonstrating consistent growth regardless of market conditions, with projections to reach into the trillions in the coming years.

For lending protocols, stablecoins drive over 90% of fee generation, yet only 10% of stablecoin holders actively use DeFi, revealing a vast untapped market.

Fig. 2.1.1 Stablecoin Marketcap Growth is Consistent since 2020 (Source: Artemis)

We are exploring how Minterest can:

Leverage institutional and retail adoption trends to capture the expanding stablecoin market.
Address key onboarding challenges that limit DeFi adoption among stablecoin holders.
Expand stablecoin lending options across multiple chains to attract new liquidity.

Understanding how to bridge this adoption gap and align with rising stablecoin demand is a key focus as we refine our PMF strategy.

2.2 Exploring Friction Points to Adoptions

Despite DeFi’s growth, onboarding complexity and liquidity fragmentation remain significant barriers to mainstream adoption. Our team is evaluating innovations that could reduce these frictions, making DeFi lending more accessible and efficient.

We are assessing:

Gasless Transactions & Smart Wallets: Exploring account abstraction to simplify onboarding by removing gas fees as a barrier to entry.
AI-Powered Risk Management: Researching automation for borrowing rates, yield optimisation, and liquidation protection to improve efficiency.
Intent-Based Execution: Evaluating solutions that automatically route lending actions to the best available rates without requiring manual intervention.

Rather than assuming any one solution is the answer, we’re focused on testing and validating where these innovations can deliver the most impact.

3. Listing Impact: Aligning with Ecosystem Growth

We know how much the MINTY listing means to you, our community and investors, especially after years of waiting. Rather than treating it as a one-time event, we believe a well-timed listing must align with our growth and long-term sustainability to deliver real value for everyone.

A thriving protocol strengthens MINTY by making it more valuable in a strong lending market, while a smart launch will draw in liquidity providers and borrowers to join our ecosystem. To make this happen, we’re linking the listing to real growth, aiming for at least $50M in borrow TVL as a key goal. This milestone ensures:

Liquidity stays steady, offering reliable rates for suppliers and borrowers.
Borrowing demand holds firm, supporting long-term fees to fund improvements and buybacks for all of us.
Market momentum builds a solid liquid environment, setting MINTY up for success.

Instead of rushing, we’re focused on launching MINTY in a way that creates lasting value. Our roadmap, outlined below, shows how we’re working toward this $50M borrow TVL milestone, with you in mind.

4. Roadmap: The Path Forward

We’re building on our 2024 wins, reaching $16M TVL on Mantle, growing our social community to 100,000 followers, and expanding across four chains to find the right fit for Minterest and set up a sustainable MINTY listing we can all celebrate:

As you’ve seen in the roadmap, we’ve accomplished a lot in Q1 and have even bigger goals for the months ahead. Now you can dive deeper into our journey and explore the key milestones, achievements, and what’s next:

Q1 2025: Laying the Foundation:

Expanded Team: Added experts in product, engineering, operations, and marketing.
New Homepage Launch: Updated homepage for easier access.
Fan Card NFT Launch: Launched Dagora NFTs with MINTY allocations.
Protocol Deployment on Morph via adaptiFi: Started on Morph via adaptiFi for new lending options.
MINTY Expansion on Viction: Extended MINTY to Viction for new liquidity.

Q2 2025: Focusing on Product-Market Fit:

Improve Minterest Interface: Simplify Minterest for easier use.
Liquidity Partnerships: Build partnerships for stable capital.
Implementing New PMF Strategies: Launch strategies to boost TVL and ease onboarding.

Q3 2025: Scaling for Impact:

Protocol Integrations: Connect to more networks for new liquidity.
Strategic Partnerships: Form partnerships to expand reach.
PMF Feedback Loop: Refine strategies with user feedback for success.

Q4 2025: Assessing Future Steps:

MINTY Utility Expansion: Improve MINTY’s role in lending.
Sustainable Growth: Build a self-sustaining model, targeting $50M borrow TVL.

This roadmap is designed to create tangible, measurable progress toward sustainable growth and a listing that adds value to the entire ecosystem.

5. Looking Ahead

The Minterest team has navigated financial restructuring, security incidents, and shifting market conditions before, and we’re always moving forward. Now, we are adapting once again, focusing on sustainability and long-term growth to ensure a MINTY listing that delivers real value. This journey is shaped by your input, and the team at Minterest is committed to keeping you informed every step of the way. We’ll continue sharing updates and welcome your feedback across our social channels.

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12, March 2025