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DeFi Pulse Index 2023 Performance Review

Christoph - Jan 4, 2024 | 2 minutes read

We present a short performance review of the DeFi Pulse Index, the leading benchmark of Ethereum DeFi protocols. Overall 2023 was a strong year for the DeFi sector. The DeFi Pulse Index gained 82%, beating the TradFi sector’s meager 12% (as measured by the Financial Select Sector SPDR ETF).

DeFi Pulse Index in USD. 2023. Data source: Coingecko.

After several component changes, most importantly the addition of the liquid staking sector, the index finished the year with 9 constituent (current allocation).

DeFi Pulse Index constituents.

The index top performers in 2023 were:

  • Maker: +206%
  • Synthetix: +167%
  • Aave: +112%

On the other hand, the laggards were:

  • Loopring: +6% (until its removal in October)
  • Balancer: -18%
  • Rocket Pool: -35% (since index addition in May)

Out of the current components Maker was the greatest diversifier with an average correlation of 0.3 to the other index members. Overall DPI constituents had an average pairwise correlation of 0.5. As a result DPI’s 2023 volatility of 60% was significantly lower than the average constituent volatility of 85%.

The DeFi Pulse Index is available as a single token by the Index Coop.

Scalara is dedicated to creating and maintaining indices for a decentralized world.

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