Isn't it that because locking stable coins (in swaps) is different (much safer) than locking bitcoin/Ethereum? I mean that, f.e, if you decided to hold etherum and to add some leverage to your investment you decided to lock it in liquidity pool in ETH/USDC pair and ETH will pump hard you may in fact end up with worse returns than without locking ETH while DAI/USDC change zero exposure to value fluctuation, stable coins into profit coins as long as both coins exist. Fist spike on ETH i BTC chart was due to defi bubble and quite stable BTC (9-10k consolidation)
My point is "people likely have their investment plans with fixed amount of USD or USDT". Example, I plan to invest $1000 into a DeFi token. Next, BTC or ETH is only the mean I use to join pools. When my investment increases 2 or 3 times, I cash out $1000 or $2000 profits and only leave the original capital $1000 in the pool. I guess it causes the drop of total BTC or ETH locked in DeFi.
The figures are not exactly like that but the odds can come from new investors that has brought addtional capital locked in DeFi.
It's a pretty safe assumption, even without taking a look at the locked assets in "DeFi". It's pretty much one of the main reasons why bitcoin's price rises and price crashes are overly exaggerated(in contrast to other assets); because a lot totally inexperienced retail "investors" who don't have a single clue on what they're doing(or what Bitcoin even is) just FOMO in and panic sell out of the market.
Panic selling or panic profit-taking is one of contributors. Regarding to DeFi, it is sucked as people have to lock their asset in pools. The truth is total amount of tokens increase but price of token decrease at nearly the same rate (that causes a draw for investment) or worse at higher rate (that causes a loss for investment).
As a game of wealth distribution: from the majority to the minority, there is very little investors who are knowledgeable and determinant with their decisions can earn profits from yielding, farming, etc.
